operational procedures for foreign currency … rentas fcy v2 4 - knet.pdf · added euroclear/sds...

OPERATIONAL PROCEDURES FOR FOREIGN CURRENCY SETTLEMENT IN THE REAL TIME

ELECTRONIC TRANSFER OF FUNDS AND SECURITIES SYSTEM (RENTAS)

Doc. Ref. No.: 500-80/1/0000138

Version 2.4

Proprietary Rights

The information contained in this document is proprietary and confidential to Payments Network Malaysia Sdn Bhd (PayNet) and its subsidiary companies (PayNet Group). All rights reserved. This material may not be duplicated, published,

or disclosed, in whole or in part, without the prior written permission of PayNet

OPERATIONAL PROCEDURES FOR FC SETTLEMENTS IN RENTAS (V2.4) Doc. Ref. No.500-80/1/0000138

©2019 PayNet. Confidential. Page: 2 of 83

Document Details

Document Owner : Large Value Payments and Securities Services

Effective Date : 10 October 2019

Revision History

Version No.

Date of Update Summary of Change Updated By

1.0 23/02/ 2012 Initial Creation MyClear

1.1 30/03/2012 Clause 1.2: Added the Clause 1.2.3 on Operational Procedures for Cross-Border Securities Custody Services in RENTAS issued in March 2012

MyClear

Clause 4.0: Overview Added “Euroclear/CSDs Link” into the diagram

Clause 5.1.5 Added Clause 5.1.5 on the definition of RENTAS-Euroclear link

Clause 8.0 and 8.1 Added the words “or Cross-Border Securities Custody Services Participants” into the sentence.

Appendix V (Form A and Form B) Added an additional option to subscribe to Cross-Border Securities Custody Services.

1.2 07/05/2012 Clause 6.1.2 For MYR (a) Settlement Services: Rewording of table row to suit future situation in the event of additional services subject to BNM approval.

MyClear

Clause 6.1.3 (iv) Added new requirement for admission to RENTAS Clause 11.1 Added to the clause that all securities accounts are maintained with BNM Clause 29.2 Added a form (Appendix X) for participants to request use of RENTAS test environment Appendix VIII

• Introduce cut-off warning message for transmitting offshore payment instructions to OSI at 3.30pm; and

• Extend the cut-off time for transmitting offshore payment instructions to OSI from 3.30pm to 4.00pm.

Appendix X New request form for RENTAS test environment.



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1.3 11/09/2012 Clause 7.1.4 Added footnote for the clarity whether BNM or MyClear is responsible for the assignment of IUC. Appendix V Added new sentence (Form A and B) that participant authorized MyClear to debit the account.

MyClear

1.4 06/09/2013 Clause 5.1.6 Added new clause to reflect that PvP Settlement for MYR/RMB forex transaction is available in RENTAS with the latest release of RENTAS.

MyClear

Appendix VIII Added new timeline for PvP settlement service into the schedule.

• Introduce PvP Settlement start time in RENTAS at 9:00 a.m.

• Cut-off time for all repayment maturities and forward-dated Renminbi transactions (including PvP and DvP Settlement at 11:00 a.m.

• Introduce PvP Settlement Cut-off warning at 5:00 p.m.

• Introduce PvP Settlement Cut-off time at 5:30 p.m.

Clause 10.1 Added new message types for foreign currency settlement that are available in the latest release of RENTAS Multiple Credit Transfer:

• MT 102 – Multiple Customer Credit Transfer

• MT 203 – Multiple General Financial Institution Transfer

Debit Notification:

• MT207 – Request for Financial Institution Transfer

Credit Notification:

• MT190 – Advice of Charges, Interest and Other Adjustments for MT103

• MT290 – Advice of Charges, Interest and Other Adjustments for MT202

Appendix I Office Address and Contact Details: Address: Malaysian Electronic Clearing Corporation Sdn Bhd (MyClear) Large Value Payments and Securities Services Division Level 10, Tower 2A, Avenue 5, Bangsar South, 8, Jalan Kerinchi, 59200 Kuala Lumpur



Version No.


Telephone Number (Production): 03-22648670 03-22648671 03-22648672 Telephone Number (Recovery Centre): 03-50226776 03-50226777 03-50226778 Fax number (Production): 03-22648669 Fax number (Recovery Centre): 03-56328653 MyClear Payment Services (Application Membership, Opening of Securities Account and Customer Services): RENTAS Operation Team Contact Number: 03-2264 8666 03-2264 8671 03-2264 8670 03-2264 8672 03-2264 8673 03-2264 8674 03-2264 8675 Appendix II Appendix III Appendix IV Appendix V (Form A) Added new clause to authorise MyClear to disclose information pertaining participants’ debt securities holding under custody. Appendix V (Form B) Added new clause to authorise MyClear to disclose information pertaining participants’ debt securities holding under custody. Appendix VI Appendix VII Address change to: Director Large Value Payments and Securities Services Division Malaysian Electronic Clearing Corporation Sdn Bhd (MyClear) Level 10, Tower 2A, Avenue 5, Bangsar South,



Version No.


8, Jalan Kerinchi, 59200 Kuala Lumpur Appendix XI Added Chinese Renminbi for Settlement in RENTAS as a new Appendix on the list of foreign currencies supported for settlement in RENTAS. Appendix IX Updated the latest form and renamed the form to “External User Access Request Form”

1.5 06/12/2013 Footnotes to Clause 24.3 Provide clarity to requirement to cover all BCP and DR scenarios over three years:

• Provide definition for “Network Connectivity” and Participant’s Internal Systems in the RENTAS BCP and DR scenarios for further clarity.

• Define method of computing the duration of three years given to participants to cover BCP scenarios.

MyClear

Appendix I Change the domain of RENTAS email address from [email protected] to [email protected].

1.6 11/08/2014 Clause 24.3 To provide definition of network connectivity as follow: Note: Network connectivity refers to the point where NWI originate at the Participant’s site.

MyClear

1.7 16/04/2015 Document Information Removal of “Release Date” to avoid confusion with “Effective Date”.

MyClear

Clause 4.0 and 4.1 Incorporate new access channels to connect to RENTAS CHS, namely RENTAS Bank Gateway (RBG) and SWIFT Access; Clause 5.2 Added new clause to provide clarity on New RENTAS Access Channel. Clause 5.3 Incorporate use of SWIFTNet as a network to connect to RENTAS Clause 5.4

Reflect that RENTAS’ existing security solution, Enterprise Public Key Infrastructure (ePKI), is now used for RBG and RENTAS iLINK, while SWIFT has its own security module;

mailto:[email protected]




Version No.


Clause 7.1 and 8.2 To incorporate additional form for Participants to indicate primary access channel; Clause 10.1 Incorporate new SWIFT message formats for debit notification, credit notification and free format message; Clause 13.3.3 Incorporate new SWIFT message (MT192/292) for cancellation of the queued transactions; Clause 18.5 To incorporate SWIFT Security as part of Public Key Infrastructure Security Requirements Clause 25.1 Incorporate new Business Continuity Management should the new access channels via RBG and SWIFT fail Appendix V: Form C Incorporate new form for Participants to choose their primary access channel in Appendix V.

2.0 09/08/2016 Clause 4.0 Reflected the New RENTAS components’ diagram

MyClear

Clause 10.0 Updated the ISO15022 Message Formats Clause 14.0 Replaced iLINK with RBG and SWIFT Access as the terminal to submit the SSDS transactions and inserted SSDS Instruction and Settlement Deadlines Clause 18.0 Segregated the security requirement under e-PKI and SWIFT security for clarity purpose Guideline I Removed the requirement to include the indemnity clause in the CRN (MT198) and to clarify the automatic binding of the indemnity clause to the Participation Rules.

2.1 18/04/2017 Clause 9.0 Updated the Foreign Currency Settlement Business Hours with USD onshore settlement opening and closing time.

MyClear

Clause 9.6 Amended the clause to add exemption to 30 minute crediting requirement for transactions that fail regulatory, sanction or money laundering screening.



Version No.


Clause 24.1 and 24.2 Amended clause to make reference to the Guidelines on Business Continuity Management for Participants of MyClearServices (BCM Guidelines) Clause 24.4, 24.5 and 24.6 Removed clauses as it is covered in the BCM Guidelines. Clause 25.1.2 Amended clause to make reference to the BCM Guidelines. Clause 25.1.6 Added new clause to make reference to Appendix I – Penalty Charges in the BCM Guidelines. Clause 25.2.3 Updated contingency procedures for Onshore Settlement Insitutions (OSI) whereby the OSI would have to upload balances via RENTAS iLINK in MyClear premise. Guideline II Introduced new guideline to standardize market practices for handling invalid special characters in RENTAS.

2.2 01/01/2018 All relevant contents throughout the document Replaced MyClear with PayNet in the entire document. Clause 1.2 To add Guidelines on Business Continuity Management for Participants of PayNet’s services as an additional document to be read in conjuction with this OP; Clause 17.0 Revised type of incidents that subject to incident report submission to PayNet. Guideline II – Guidelies on Handling the Invalid Characters in RENTAS Add other relevant symbol to replace invalid symbol for “%”

PayNet

2.3 01/06/2018 Changed “Participation and Operation Rules for Payments and Securities Services” to “Participation Rules for Payments and Securities Services” throughout the document. Clause 2.0 – Scope (in previous version 2.2)

• Moved clause 2.1 to clause 1.3 ‘Introduction’

• Removed clause 2.2

PayNet



Version No.


Clause 3.0 – Definition of RENTAS (in previous version 2.2)

• Moved to new Glossary section in this Operational Procedures

Clause 6.0 –RENTAS Membership (in previous version 2.2)

• Renumbered to clause 4.0

• Inserted new clause 4.1 to make reference to the ‘Membership’ section in the Participation Rules for Payments and Securities Services.

• Inserted type VII as new criteria for the admission of RENTAS Participants in Foreign Currency Settlement Services

Clause 5.0 – Participants Representation (New) • Inserted new clause to describe the roles

and responsibilities of the RENTAS User Group Committee (RUGC) and the Rules Working Committee (RWC)

Clause 7.0 – Admission of New Participants for MYR Settlement in RENTAS (in previous version 2.2)


• Inserted new clauses 4.3.1 to 4.3.3 which was taken from clauses 15.1 to 15.3 of the Participation and Operation Rules for Payments and Securities Services V3.3

Clause 20.0 – Retention (New)

• Added new clause on retention of documents which was taken from clause 15.12 of the Participation and Operation Rules for Payments and Securities Services V3.3

Clause 22.0 - Billing (in previous version 2.2)


• Inserted new clause 18.1 to make reference to the ‘Fees and Charges’ section in the Participation Rules for Payments and Securities Services

• Added new clause 18.4

Clause 30.0 - Compensation on Inter-Bank Failed Settlements (In previous version 2.2)


• Added new clauses 13.2 and 13.3 which was taken from clause 15.5 and 15.6 of the Participation and Operation Rules for Payments and Securities Services V3.3

• Amended clause 30.2 to include clause 15.4 which was taken from the Participation and Operation Rules for Payments and Securities Services v3.3



Version No.


Appendix II – Fees and Charges for Foreign Currency Settlement (New)

• Added new Appendix II on Fees and Charges for Foreign Currency Settlement in RENTAS which was taken from Appendix II A. Fees and Charges : RENTAS (MYR and Foreign Currency Settlement

• Inserted new item 19.0 on penalty for ‘General Non-compliance’ under Appendix II

• Renumbered SWIFT Messaging Fees to item 20.0

Appendix XIV – Glossary of Terms (New)

• Definitions applicable to RENTAS (FC) in the Participation and Operation Rules for Payments and Securities Services V3.3 have been removed and inserted into this Operational Procedures

2.4 21/08/2019

Clause 2.0 – Overview • Added RPP as one of the new service under

clearing house and update the correct term for IBFT

Clause 4.0 – RENTAS Membership

• Added new clause to synchronize with Operational Procedures for MYR Settlement in RENTAS and to formalise the request for creation of Participants’ RENTAS iLINK Administrator

Clause 6.0 - Transactions Types and Message Format

• Added MT 204 in the list of transaction types and to clarify that it is only for BNM and OSI

Clause 9.0 - SSDS Processing

• Updated the SSDS processing time as agreed by RUGC

Clause15.0-RENTAS iLINK Certificate (ID) Registration

• Removed Clause 15.5 as there is statement redundancy regarding to Appendix XIII

Clasue 26.0 - Network Connectivity Failure • Removed clause on ISDN connectivity as it is

no longer available • Added new clauses as alternative for

participants who encounter network connectivity failure. The added clauses are to specify RENTAS iLINK settings requirements to ensure smooth RENTAS iLINK activation

Appendix II - Fees and Charges for Foreign Currency Settlement Services

• Updated Credit Notification for third party i.e. MT198 for Customers Transfer Tracking



Version No.


as Free of Charge as it is a regulatory requirement

• Added RPP settlement and clarified that penalty is per incident

Appendix VI – Form C: Confirmation of Access Channel for MYR Settlement in RENTAS

• Changed the term Full STP Gateway NWI to RENTAS Bank Gateway

Appendix XII – RENTAS BCP Live Run and Activation of 3rd BCP at PayNet Checklist RBG BCP Live Run Checklist

• Generalized documents’ name without referring to specific version to keep document applicable throughout time

Appendix IX – External User ID Access Request Form

• Replaced with the latest version published by PayNet ITS

Appendix XVI - Glossary of Terms

• Added RPP definition in Glossary Section

Updated office address, telephone number and fax number due to LVPS relocation for the applicable Appendices and Forms



Table of Content 1.0 Introduction ..................................................................................................................................... 12 2.0 Overview .......................................................................................................................................... 13 3.0 System Components ........................................................................................................................ 14 4.0 RENTAS Membership ....................................................................................................................... 16 5.0 Participants Representation ............................................................................................................. 20 6.0 Transactions Types and Message Formats ...................................................................................... 22 7.0 Foreign Currency Settlement ........................................................................................................... 24 8.0 Queue Management ........................................................................................................................ 28 9.0 Foreign Currency SSDS Processing ................................................................................................... 29 10.0 Foreign Currency Corporate Bonds and Sukuk (Non-Specified RENTAS Securities) ........................ 31 11.0 Request for Extension of RENTAS Foreign Currency Settlement Cut-off Time ................................ 32 12.0 Incident Report (IR) .......................................................................................................................... 34 13.0 Compensation on Inter-Bank Failed Settlements ............................................................................ 35 14.0 Public Key Infrastructure Security Requirements ............................................................................ 36 15.0 RENTAS iLINK Certificate (ID) Registration ....................................................................................... 37 16.0 Digital Certificates ............................................................................................................................ 38 17.0 Authenticity, Confidentiality and Irrevocability of the RENTAS Foreign Currency Settlement

Messages .......................................................................................................................................... 39 18.0 Billing ................................................................................................................................................ 40 19.0 Online Host Enquiry ......................................................................................................................... 41 20.0 Retention.......................................................................................................................................... 42 21.0 Business Continuity Management (BCM) ........................................................................................ 43 22.0 BCM Arrangements in Relation to RENTAS Failure .......................................................................... 44 24.0 RENTAS Host Failure at Production Site ........................................................................................... 46 25.0 e-PKI Failure ..................................................................................................................................... 47 26.0 Network Connectivity Failure........................................................................................................... 48 27.0 Testing Procedures ........................................................................................................................... 49 28.0 User Manuals ................................................................................................................................... 50 29.0 RENTAS Participants Directory ......................................................................................................... 51 30.0 Customer Service ............................................................................................................................. 52 Guidelines ................................................................................................................................................... 53 Guideline I - Compensation on Inter-bank Failed Settlements ................................................................... 53 Guideline II - Guidelines on Handling the invalid characters in RENTAS .................................................... 58 Appendices ................................................................................................................................................. 59 Appendix I - RENTAS – Contact Details ....................................................................................................... 59 Appendix II – Fees and Charges for Foreign Currency Settlement ............................................................. 60 Appendix III – Request for Extension of RENTAS Foreign Currency Settlement Cut-off Time .................... 63 Appendix IV - Incident Report from Participants ....................................................................................... 64 Appendix V - Request To Re-sequence or Cancel Payment Instructions In Priority Queue ....................... 65 Appendix VI - Form A: New Participant ...................................................................................................... 66 Appendix VI - Form B: Existing RENTAS Participant Extend Membership to Foreign Currency Settlement Service ......................................................................................................................................................... 67 Appendix VI - Form C: Confirmation of Access Channel for Foreign Currency Settlement in RENTAS ..... 68 Appendix VII - Contact Person for Daily Operation of RENTAS ................................................................... 69 Appendix VIII - RENTAS – Authorised Signatories List ................................................................................ 70 Appendix IX – External User Access Form ................................................................................................... 71 Appendix X – Request Form for RENTAS Test Environment ....................................................................... 73 Appendix XI – Supported Foreign Currency ................................................................................................ 74 Appendix XII - RENTAS BCP Live Run and Activation of 3rd BCP at PayNet Checklist ................................ 75 Appendix XIII – Guideline for Registration of New Digital Certificate in RENTAS iLINK .............................. 76 Appendix (XIV) – Glossary of Terms ............................................................................................................ 78



1.0 Introduction 1.1 The Operational Procedures provide information and procedures that are applicable to

Participants using the Real Time Electronic Transfer of Funds and Securities (RENTAS) for Foreign Currency Settlement for interbank fund transfers, clearing houses’ transactions and securities trades and corporate actions.

1.2 These Operational Procedures shall be read in conjunction with the following documents:

i. Participation Rules for Payments and Securities Services; ii. Operational Procedures for MYR Settlement in RENTAS; iii. Operational Procedures for Securities Services; iv. Operational Procedures for Cross-Border Securities Custody Services in RENTAS; v. Guidelines on Business Continuity Management for Participants of PayNet’s Services;

and vi. Other relevant guidelines, notices, circulars issued by PayNet or BNM from time to

time. 1.3 These Operational Procedures are intended to equip Participants with an operating

knowledge of Foreign Currency Settlement in RENTAS and serve as a basis for Participants to develop comprehensive internal procedures.



2.0 Overview

2.1 Participants may initiate payment and securities transactions using the Participant

Terminals. Of the 3 types of Participant Terminals, Participants shall use the RENTAS Bank Gateway (RBG) or the SWIFT Access as their primary means of initiating and processing RENTAS transactions1. RENTAS iLINK is a contingency access channel in the event that RBG or SWIFT Access fails. The Participant Terminals transmit the transactions to the RENTAS Host where the transactions are processed by simultaneously debiting the paying Participant and crediting the receiving Participant’s MYR Settlement Account maintained with Bank Negara Malaysia (“BNM”) or the Participant’s Foreign Currency Settlement Accounts maintained with designated Onshore Settlement Institutions (OSI). Upon completion of funds transfer transactions, RENTAS Host will send completion advices to the paying Participants, while the receiving Participants will receive confirmation advices.

2.2 The RENTAS Host will process all transactions on an online and real time basis. Participants

may also perform online queries on the status of their transactions and account balances via RENTAS iLINK.

1 Participants with only non-essential transactions, low aggregate transaction value and very low volume may

seek exemption from this requirement

Onshore Settlement institutions (OSI)

MCT SAS (Foreign Currency

Settlement Account System) Instant

Transfer & SAN

Clearing Houses and Networks Networks

FAST

USD CHATS

(PvP Link)

Euroclear/ CSDs

Link

SWIFT Access

RENTAS iLINK

RENTAS Bank Gateway

Participants Terminals

eSPICK

Interbank GIRO

FPX & Direct Debit

MyDebit

PayNet

Bursa Malaysia

MYR Settlement Institution (BNM)

Foreign CCY Settlement Institution

RENTAS Host

SSDS (Scripless Securities

Depository and Settlement System)

IFTS (Interbank Funds Transfer System)

MYR SAS (MYR Settlement Account System)

MCT SAS (Foreign Currency

Settlement Account System)

RPP



3.0 System Components

3.1 RENTAS Host System (RENTAS Host)

The RENTAS Host consists of the following major modules:

3.1.1 Inter-bank Funds Transfer System (IFTS) This module receives, validates, queues and processes fund transfer transactions and cash Settlements. It then relays the transactions to the MYR Settlement Account System (MYR SAS) or the Foreign Currency Settlement Account System (MCT SAS), where debit and credit transactions are posted to the Participants’ MYR Settlement Account or foreign Currency Settlement Account respectively.

3.1.2 MYR Settlement Account System (MYR SAS)

This is a real-time accounting module that posts debits and credits to MYR cash accounts across the books of BNM. All MYR Settlement Accounts are maintained with BNM.

3.1.3 Foreign Currency Transfer Settlement Account System (MCT SAS)

This is a real-time accounting module that posts debits and credits to foreign currency cash accounts across the books of OSIs. All Foreign Currency Settlement Accounts are maintained with OSIs.

3.1.4 Scripless Securities Depository and Settlement System (SSDS)

This module receives, validates, queues and processes securities sales, repos, free-of-payment transfers and pledges. It then simultaneously initiates debit and credit to the Securities Account of the buyer and seller and synchronizes securities Settlement with cash Settlement in the IFTS module to achieve Delivery versus Payment (DvP).

3.1.5 Payment vs Payment (PvP) Link to USD CHATS

PvP is a cross border link between the RENTAS system and the USD CHATS system in Hong Kong. This link provides real-time Settlement for foreign exchange (FX) transactions involving US Dollars (USD) and MYR, whereby USD settlement takes place in USD CHATS, while MYR settlement takes place in RENTAS.

3.1.6 RENTAS Euroclear Link

This is a cross-border link between RENTAS and Euroclear. This link allows RENTAS to offer securities Settlement and custody services through the Euroclear System and serves as the basis for Cross-Border Securities Custody Services in RENTAS (CSCS).

3.2 RENTAS Terminals

Participants Terminals

3.2.1 There are 3 RENTAS Terminals that Participants can use to access New RENTAS, namely the RENTAS Bank Gateway, SWIFT Access and RENTAS iLINK. Participants may opt for either the RENTAS Bank Gateway or SWIFT Access as their primary terminal, while RENTAS iLINK may be used for contingency purposes:



i. RENTAS Bank Gateway (RBG) Participants use RBG to enter, transmit and receive MYR and foreign currency funds and securities transactions. RBG also provides straight-through processing capabilities to automatically relay transactions from Participants’ internal systems to RENTAS Host without the need for data entry or manual intervention at RBG. RBG connects to RENTAS Host via the network described in Clause 3.3.

ii. SWIFT Access

Participants use SWIFT Access to enter, transmit and receive MYR and foreign currency funds and securities transactions. SWIFT Access has 2 technology platforms, namely SWIFT Alliance Access (SAA) and SWIFT Alliance Lite2. SAA is a system with straight-through processing capabilities installed at the Participants’ premises or data centres while SWIFT Alliance Lite2 is a cloud solution that is hosted offshore by SWIFT. Due to regulatory requirements that prohibit the use of offshore cloud solutions for payment processing, Participants are only allowed to use SAA to access RENTAS Host. SWIFT Access connects to RENTAS Host via SWIFT’s messaging network

iii. RENTAS iLINK RENTAS iLINK is a web-based system that provides real-time information such as cash positions, securities holdings and Settlement status of transactions. RENTAS iLINK also acts as a Participant Terminal that: a) allows initiation of MYR and foreign currency funds and securities

transactions; and b) allows initiation of CSCS settlement instructions and custody operation

instructions. RENTAS iLINK is connected to RENTAS Host via the private network described in Clause 3.3 as well as the Internet. Access to iLINK via the Internet would be enabled only if the primary network described in Clause 3.3 fails.

3.3 Network 3.3.1 Participants using RENTAS iLINK and RBG connect to RENTAS Host via a security

private communication network provided by a third party provider determined by PayNet.

3.3.2 Participants using SWIFT Access connect to RENTAS Host via SWIFTNet.

3.4 Enterprise Public Key Infrastructure (e-PKI) 3.4.1 Enterprise Public Key Infrastructure (e-PKI) provides data authenticity, integrity and

non-repudiation features, thus ensuring the security of transactions and information transmitted via RBG and RENTAS iLINK.



4.0 RENTAS Membership 4.1 This Clause 4.0 shall be read in accordance with the Membership section in the

Participation Rules for Payments and Securities Services 4.2 Types of RENTAS membership

4.2.1 RENTAS membership is open to entities that meet the following criteria: i. Financial Institutions (FIs) regulated by BNM, and institutions under BNM’s

purview; ii. Investment banks co-regulated by BNM and the Securities Commission of

Malaysia; iii. International Central Securities Depository (ICSD) and National Central

Securities Depository (CSD); iv. Central banks / monetary authorities, qualified foreign licensed financial

institutions and multi-lateral development banks; v. Qualified domestic entities that provide payment and clearing services

(clearing houses); vi. Qualified institutions whose admission will promote the development of the

Malaysian financial markets. vii. Licensed FIs regulated by Labuan Financial Services Authority (LFSA)

4.2.2 There are seven (7) types of RENTAS membership as illustrated in the table below:

Type 1 Type II Type III Type IV Type V Type VI Type VII

Type of Institution

• Licensed FIs regulated or co-regulated by BNM

• Institutions under BNM’s purview

• Development Financial Institutions

• Domestic entities admitted for market development purposes

ICSDs and CSDs

Foreign central banks

Qualified foreign entities and multilateral institutions

• Clearing houses

• Qualified local corporates

• Licensed FIs regulated by Labuan Financial Services Authority (LFSA)

For MYR:

a) Settlement Services

Access to both Settlement and Securities Accounts


Access to Securities Accounts only

Access to Securities Accounts for own holdings only

Access to Securities Accounts for own holdings only

Access to Settlement and securities Accounts for own holdings only

(Not Applicable)

b) Intraday credit facility

Yes No No No No No (Not Applicable)

c) Direct Participation

Yes Yes Yes Yes Yes Yes (Not Applicable)



Type 1 Type II Type III Type IV Type V Type VI Type VII

For Foreign

Currency:

a) Settlement Services



Access to Securities Account

Access to Securities Account for own holdings only

Access to Securities Account only

Access to Settlement Accounts only

Access to Settlement Account Only

b) Intraday Credit Facility At the discretion of OSI where Participant maintains the foreign currency account


Yes Yes Yes Yes Yes Yes Yes

For Cross-Border Securities:

a) Settlement

Access to both cash sub-account and securities sub-accounts in Euroclear, with mirror accounts in RENTAS

(Not Applicable)

b) Intraday Credit Facility

No No No No No No (Not Applicable)


Yes Yes Yes Yes Yes Yes (Not Applicable)

4.2.3 Potential participants seeking admission to RENTAS shall fulfil the following requirements: i. Demonstrate financial soundness; ii. Have sufficient liquidity position or credit lines to cover the participants’

maximum expected settlement obligation in RENTAS; iii. Have sufficient expertise and resources to operate RENTAS; and iv. Possess sufficient risk management and business continuity planning

framework and policies.

4.2.4 Foreign entities with access to only securities accounts in RENTAS shall open a MYR cash account with a Malaysian bank for MYR cash settlement purposes and shall ensure sufficient liquidity at their participating banks, either by maintaining sufficient balances or by obtaining access to credit lines.

4.2.5 Documents that have to be submitted for the participation application shall include: i. The latest three (3) years audited financial statements; ii. Certificate of incorporation; iii. Board resolution approving participation in RENTAS; and iv. Memorandum and articles of association.

4.2.6 Participants may be requested to submit documents on an annual basis to provide evidence that they are in compliance with the requirements outlined in Clause 4.2.3.

4.2.7 PayNet may waive document submissions for entities that are regulated by BNM, or entities under BNM’s purview.



4.3 Admission of New Participants for Foreign Currency Settlement

4.3.1 RENTAS currently offers Settlement services in MYR and selected foreign currencies.

4.3.2 Participants may opt to participate in the Settlement services of any or all of the

supported currencies stated in Appendix XI.

4.3.3 The annual RENTAS membership fees is as stated in Appendix II and is applicable to all RENTAS Participants. Participants are required to pay only a single annual membership fee in MYR even if the Participant participates in the Settlement services of more than one currency.

4.4 To participate in RENTAS Foreign Currency Settlement, new Participants must complete

and submit the following forms: i. “Confirmation of Participation” form to PayNet as per Appendix VI (Form A); ii. “Confirmation of Access Channel for Foreign Currency Settlement in RENTAS” form as

per Appendix VI (Form C); iii. “Contact Person for the Daily Operation of RENTAS” form as per Appendix VII; iv. “RENTAS – Authorised Signatories List” form as per Appendix VIII v. “External User Access Form” in Appendix IX

In addition, new Participants shall also undertake the following:

4.4.1 Open a foreign currency account with the OSI. The OSI will then open a corresponding Foreign Currency Settlement Account for the Participant in RENTAS;

4.4.2 Obtain a Bank Identification Code (BIC) by registering with The Society for

Worldwide Inter-bank Financial Telecommunication (SWIFT). The BIC will be used as part of a Unique Identifier Code (UIC) for the Participant;

4.4.3 Obtain a digit code from BNM. This code is to be used as the UIC for each

Participant2;

4.4.4 Acquire RENTAS application software for the Participant Terminals (RBG and/or SAA) from authorised vendors. For SAA, the authorised vendor is SWIFT or, if applicable, a solution provider nominated and certified by SWIFT. For RBG, the authorised vendor would be designated by PayNet;

4.4.5 Deploy the applicable communication network for RBG or SAA as stated in Clause

3.3;

4.4.6 Deploy the relevant security solutions depending on the type of access channel: i. For RBG and RENTAS iLINK, the e-PKI security module (including HSMs, tokens

and certificates) is used; ii. For SWIFT Access, the security module (including HSMs, tokens and

certificates) specified by SWIFT is used.

2 For institutions that are not under the purview of BNM, the UIC will be provided by PayNet



4.4.7 Establish a Business Continuity Plan (BCP) for the Participant’s RENTAS operations;

4.4.8 Establish processes, internal controls and procedures to ensure that RENTAS

operations are carried out with minimal risk to the Participant, counterparties and PayNet;

4.4.9 Notify PayNet’s Payment Services Section for the activation of access to RENTAS

iLINK;

4.4.10 Notify PayNet in writing two (2) weeks before the actual implementation date of operations; and

4.4.11 Submit the “External User Access Form” in Appendix IX to request the creation of

RENTAS iLINK Administrator ID. This RENTAS iLINK Administrator IDs will be able to create IDs and assign access rights for the new Participants’ officers.

4.4.12 PayNet shall open a Securities Account for new Participants that indicate their

participation in Securities Services in the “Confirmation of Participation” form stated in 4.4.

4.5 Existing RENTAS MYR Participants or Cross-Border Securities Custody Services (CSCS)

Participants Subscribing to Foreign Currency Settlement

4.5.1 Existing RENTAS Participants for MYR settlement or Cross-Border Securities Custody Services (CSCS) Participants who have received approval from PayNet to participate in the Foreign Currency Settlement shall open a foreign currency account with the OSI. The OSI will then open a Foreign Currency Settlement Account for the Participant in RENTAS.

4.5.2 The Participant shall complete and submit the form to PayNet as per Appendix VI

(Form B: Existing RENTAS Participant Extend Membership to MYR Settlement Service) two (2) weeks before the actual implementation date of the Participants’ Foreign Currency Settlement operations.

4.5.3 In addition, the Participants shall undertake the tasks mentioned in Clauses 4.4 to

4.4.12



5.0 Participants Representation 5.1 RENTAS User Group Committee (RUGC):

5.1.1 To ensure that Participants are kept updated and consulted regarding amendments to the RENTAS system and Operational Procedures, PayNet has established the RENTAS User Group Committee (RUGC) which comprise of all the Business units of RENTAS Participants.

5.1.2 The role of the RUGC is to:

5.1.2.1 Provide feedback and advice to PayNet to guide the business, development, operation and governance of RENTAS.

5.1.2.2 Co-ordinate and implement improvements and changes to RENTAS at their respective organizations.

5.2 Rules Working Committee (RWC):

5.2.1 The RWC is a Committee consisting of Industry representatives who advise and guide PayNet in respect to any proposed changes and/or development in the Rules and Operational Procedures of RENTAS, FAST and eSPICK.

5.2.2 The role of RWC is to:

5.2.2.1 To ensure that any issues arising from any developments in the Rules and Operational Procedures of RENTAS, FAST and eSPICK are consulted and deliberated.

5.2.2.2 Co-ordinate and ensure implementation of improvements and changes to the RENTAS, FAST and eSPICK at their respective organizations.

5.2.3 Composition of RWC:

5.2.3.1 The RWC shall consist of the following members:

i. One representative from PayNet; ii. One representative from Bank Negara Malaysia; iii. Two representatives from the Association of Banks in Malaysia (ABM); iv. Two representatives from the Association of Islamic Banking

Institutions Malaysia (AIBIM); v. Two representatives from Malaysian Investment Banking Association

(MIBA); and vi. One representative from non-bank participants (such as Cagamas

Bhd, Bursa Malaysia, Kumpulan Wang Simpanan Pekerja (KWSP) and Kumpulan Wang Persaraan (Diperbadankan)).

5.2.4 Nomination of Membership:

5.2.4.1 Members are appointed by the respective banking associations, with the exception of representative of non-bank participants, which shall be rotated amongst all non-bank participants on a two-yearly basis.

5.2.5 Chairperson and Secretariat:

5.2.5.1 PayNet will chair the RWC. 5.2.5.2 PayNet shall act as the Secretariat of the RWC. 5.2.5.3 The Secretariat role entails:

i. To manage committee meeting logistics; ii. Record and prepare minutes of meeting; iii. Disseminate meeting agenda and relevant documents to the



members of the committee 3-5 days in advance of the meeting; and iv. Acting as custodian of committee’s documentation.

5.2.6 Frequency of RWC Meeting and Quorum:

5.2.6.1 Meeting shall be held on a need-to-meet bases as determined by the Chairperson.

5.2.6.2 The quorum of the meeting shall be two thirds (2/3) of the members of the RWC.

5.2.7 Responsibility of Committee Members:

5.2.7.1 Attend RWC meetings; 5.2.7.2 Act as representatives of their organizations, ensuring that all

stakeholders within their organization are consulted and kept informed regarding RENTAS, FAST and eSPICK activities, initiatives and developments;

5.2.7.3 Circulate updates provided by PayNet to all relevant parties within their organization;

5.2.7.4 Formulate and articulate their organiations’ position and stance on any development, proposed amendments and/or issuance to the RENTAS, FAST and/or eSPICK rules and operational procedures by obtaining and integrating views of all relevant parties within their organization;

5.2.7.5 Provide feedback to any proposed amendments to the existing rules and procedures and/or the issuance of new rules for RENTAS, FAST and/or eSPICK;

5.2.7.6 Propose amendments to the existing RENTAS, FAST and/or eSPICK rules and Operational Procedures;

5.2.7.7 Co-ordinate and ensure timely implementation of RENTAS, FAST and/or eSPICK initiatives at their respective organizations; and

5.2.7.8 To highlight, discuss, resolve and/or facilitate any other matters or issues in relation to the rules referred to the RWC, the participants or other related parties.



6.0 Transactions Types and Message Formats 6.1 RENTAS supports the following transaction types which shall be initiated and transmitted

using the corresponding SWIFT ISO 15022 message formats:

Transaction Type ISO 15022 Message Format

Fund Transfer Services

Single Credit Transfer MT 103 – Single Customer Credit Transfer

MT 202 – General Financial Institution Transfer

Multiple Credit Transfer MT 102 – Multiple Customer Credit Transfer

MT 203 – Multiple General Financial Institution Transfer

Single Debit Transfer

MT 204 – Single Customer Debit Transfer

Note:

Applicable to BNM and Onshore Settlement Institution

(OSI) only

Transaction Cancellation Request (send to RENTAS Host)

MT 192 – Request for Cancelation of MT103, MT103

and MT198 (credit notification)

MT 292 – Request for Cancelation of MT202, MT203,

MT210 and MT298 (credit/debit notification)

Transaction Processing Status Update

MT 198 – Response to MT 1xx Messages

MT 298 – Response to MT 2xx Messages

MT 598 – Response to MT 599 Messages

MT 998 – Response to MT 999 Messages

Debit Notification MT 298 – Request for Financial Institution Transfer

Credit Notification (Advice for return/recover of fund)

MT 198 – Advice of Charges, Interest and Other Adjustments

MT 298 – Advice of Charges, Interest and Other Adjustments

Notice to Receive MT 210 – Notice to Receive

Customer Transfer Tracking

MT 198 – Customer Transfer Tracking

Allegement Message

MT 298 – Onshore PVP Allegement

MT 298 – Pre-Advice of Fund Allegement

Confirmation of Debit MT 900 – Confirmation of Debit

Confirmation of Credit MT 910 – Confirmation of Credit





Securities Settlement Services

Securities Transfer Message

MT 540 – Receive Free of Payment

MT 541 – Receive Against Payment

MT 542 – Deliver Free of Payment

MT 543 – Deliver Against Payment

Settlement Allegement Message

MT 578 – Settlement Allegement

Settlement Status and Processing Advice Message

MT 548 – Settlement Status and Processing Advice

Securities Transfer Confirmation Message

MT 544 – Receive Free Confirmation

MT 545 – Receive Against Payment Confirmation

MT 546 – Deliver Free Confirmation

MT 547 – Deliver Against Payment Confirmation

Settlement Reports

Cash Settlement Reports

MT 920 – Request Message

MT 940 – Statement Message

MT 941 – Balance Report

MT 950 – Cash Statement

Securities Settlement Reports

MT 549 – Request for Statement Advice

MT 535 – Statement Holding

MT 536 – Statement of Transactions

Corporate Action Settlement

Corporate Action

MT 564 – Corporate Action Notification

MT 566 – Corporate Action Confirmation

MT 567 – Corporate Action Status and Processing Advice

MT 568 – Corporate Action Narrative

Free Format Message

Free Format Message

MT199 – For MT1xx message






7.0 Foreign Currency Settlement

(i) Foreign Currency Settlement Business Hours

7.1 The Business hours for Foreign Currency Settlement in RENTAS is from 8.30 am to 6.00 pm

on all Business days. 7.2 The detailed schedules for Foreign Currency Settlement activities in RENTAS are as specified

in the table below:

Scheduled Hours Actions

8.30am Foreign Currency Settlement Service opening time

PvP Settlement Start Time in RENTAS

11:00am Cut-off time for all repayment maturities and forward-dated Foreign Currency

transactions (including PvP and DvP Settlement)

3:30pm Cut-off warning message for transmitting offshore payment instructions to

the OSI (only Renminbi)

4.00pm Cut-off time for transmitting offshore payment instructions to the OSI3

5:00pm Foreign Currency Settlement Cut-off warning

PvP Settlement Cut-off warning

5.30pm Foreign Currency Settlement Cut-off time for RMB

PvP Settlement Cut-off time for RMB

6.00pm Foreign Currency Settlement Cut-off time for USD

PvP Settlement Cut-off time for USD

7.3 PayNet may amend the scheduled time in Clause 7.2, if circumstances warrant such a change, either temporarily or permanently.

7.4 Participants are strongly advised to observe the cut-off times for payments and settlements

as delays may affect the liquidity of counterparties that are expecting these payments. In the event of unavoidable delays, the paying Participants shall communicate directly with the receiving Participants on the delay.

7.5 To avoid possible transaction congestion during peak hours and the risk of failed

Settlement, Participants are encouraged to transmit their Messages as early as possible.

3 Offshore payment instructions refers to foreign currency payments by a Participant to counter-parties

outside Malaysia who are not RENTAS participants. Such transactions involve sweeping out funds from the OSI to an offshore correspondent bank. Currently the service is only available for RMB.



7.6 Availability of Funds for Beneficiary 7.6.1 All paying Participants shall transmit payment instructions to RENTAS Host within

30 minutes of receiving an instruction from the paying customers except for transactions that fail regulatory, sanction or money laundering screening.

7.6.2 All receiving Participants shall make funds available to the beneficiary customers

within 30 minutes upon completion of the final validation (by paying participants), except for transactions that fail regulatory, sanction or money laundering screening.

7.7 Forward-Dated Transactions 7.7.1 Participants may key-in via their Participant Terminals same day value and forward-

dated foreign currency transaction as follows: i. IFTS: Forward-dated for up to one (1) calendar year; and

ii. e-SSDS: Forward-dated for up to one (1) calendar year

(ii) Foreign Currency Settlement Accounts 7.8 All RENTAS Foreign Currency Settlement Accounts are maintained with designated OSIs.

Hence, RENTAS transactions are settled across the books of the OSI. The settlement asset is a claim on the OSI. All Securities Accounts are maintained with BNM.

7.9 At the beginning of each Business day, the OSI will provide the opening balance in the

Participants’ Foreign Currency Settlement Accounts to PayNet. 7.10 During RENTAS Business hours, Participants shall transmit all transactions for their Foreign

Currency Settlement Accounts via RENTAS. 7.11 At RENTAS Foreign Currency Settlement Cut-off, RENTAS will transmit the closing balances

of each Participant’s Foreign Currency Settlement Account accompanied by a list of all transactions to the OSI to update the Participant’s account at the OSI.

7.12 Throughout the RENTAS Business hours, Participants are able to view their Foreign

Currency Settlement Account balances, transaction status and Securities Account balances in real-time via RENTAS iLINK.

7.13 After RENTAS Foreign Currency Settlement Cut-off, Participants are able to print their

closing account balances, daily transaction activities and other end-of-day reports via RENTAS iLINK.

7.14 After RENTAS Foreign Currency Settlement Cut-off, RENTAS shall transmit closing balances

to OSI. 7.15 The OSI will provide Participants with an end-of-day account statement directly via a SWIFT

MT950 message. The account statement is provided only on Business days when there are transaction activities. RBG Participants will receive the end-of-day account statements via email.

7.16 Forward-dated transactions transmitted to RENTAS after the RENTAS Foreign Currency

Settlement Cut-off will be stored for settlement until the value date of the transaction.



(iii) Settlement Finality 7.17 All RENTAS payments are final and irrevocable after the paying Participant submits the

payment to RENTAS Host, and the payment has met all conditions necessary to execute the final transfer of funds across the books of OSIs. The conditions for final settlement across the books of OSIs are as follows: 7.17.1 Paying Participant has sufficient liquidity to cover the payment; 7.17.2 Paying Participant is in good standing, whereby its membership status is not

suspended or terminated; 7.17.3 Value date of payment is a Business day; 7.17.4 Receiving participant is in good standing, whereby its membership status is not

terminated; 7.17.5 Payment submission time is within the Foreign Currency Settlement Business Hours

specified in Clause 7.2; 7.17.6 The Payment Message content and remittance information meets the

requirements specified herein. 7.18 Once all the above conditions are met, the Paying Participant’s account is debited, and

receiving Participant’s account is credited on a final and irrevocable basis. 7.19 All RENTAS SSDS sales and repos are final and irrevocable after:

7.19.1 the seller transmits a Deliver versus Payment message (MT543) and the buyer transmits a Receive versus Payment message (MT541) to RENTAS Host;

7.19.2 the MT543 and MT541 messages are matched; and 7.19.3 the transaction has met all conditions necessary to execute the final transfer of

funds across the books of OSIs from the buyer to seller’s Settlement Accounts, simultaneously against the transfer of securities from the seller to the buyer’s Securities Accounts. The conditions for final settlement across the books of OSIs are as follows: i. Buyer has sufficient liquidity to cover the securities purchase; ii. Seller has sufficient securities to deliver; iii. Both buyer and seller are in good standing, whereby its membership status is

not suspended or terminated; Value date of payment is a Business day; iv. Securities transacted is valid, transferable and has not matured; v. Transaction submission time is within the Foreign Currency Settlement

Business Hours specified in Clause 7.2; vi. The transaction message content and remittance information meets the

requirements specified herein.

7.20 Once all the above conditions are met, the buyer’s Settlement Account is debited, seller’s Settlement Account is credited, buyer’s Securities Account is credited, and the seller’s Securities Account is debited on a final and irrevocable basis simultaneously.

7.21 All RENTAS SSDS free of payment transfers are final and irrevocable after: 7.21.1 the transferee initiates a Receive Free of Payment message (MT540) and the

transferor initiates a Deliver Free of Payment message (MT542) to RENTAS Host; 7.21.2 the MT540 and MT542 are matched; and 7.21.3 the transaction has met all conditions necessary to execute the final transfer of

securities from the transferring Participant to the receiving Participant’s Securities Account. The conditions for final settlement across the books of OSIs are as follows: i. Transferring Participant has sufficient securities to deliver; ii. Both transferring and receiving Participants are in good standing, whereby

their membership status are not suspended or terminated;



iii. Value date of payment is a Business day; iv. Securities transacted are valid, transferable and have not matured.

7.22 Once all the above conditions are met, the transferring Participant’s Securities Account is debited and the receiving Participant’s Securities Account is credited on a final and irrevocable basis. Participants will receive a confirmation message from RENTAS Host for each transaction that is successfully settled. MT544 for MT540, MT545 for MT541, MT546 for MT542 and MT547 for MT543 (Refer to table in Clause 6.0).

7.23 For USD securities settled on DvP via USD CHATS, the transactions are considered final

when: 7.23.1 the US dollar securities is credited into the purchaser’s account in RENTAS; and 7.23.2 cash is transferred to the seller via Participants’ correspondent bank’s account with

the USD CHATS settlement bank in Hong Kong.



8.0 Queue Management

8.1 If Participants do not have sufficient funds or sufficient securities, their transactions will be queued centrally at RENTAS Host on a First-in, First-out (FIFO) basis. There are two (2) types of payment queues, namely the normal queue and priority queue.

8.2 During the Foreign Currency Settlement Cut-off, all unsettled instructions in both the

normal and priority queues will be cancelled by RENTAS Host. Participants will be notified accordingly via online reports.

8.3 Normal Queue Management 8.3.1 Through RENTAS iLINK, Participants may manage their Foreign Currency IFTS

payment normal queue by: i. Re-ordering their queued transactions; or ii. Cancelling the queued transactions.

8.3.2 Participants may also make online real-time queries on their outgoing and incoming normal payment queues via RENTAS iLINK.

8.4 Priority Queue Management 8.4.1 Only PayNet is allowed to re-order or cancel transactions in the priority queue. 8.4.2 Participants shall submit a form (as per Appendix V) to PayNet in order to re-

sequence or cancel transactions in the priority queue should the need arise. 8.4.3 Although Participants are not allowed to manage transactions in the priority queue,

Participants may make online real-time queries on their outgoing and incoming MYR priority payment queues via RENTAS iLINK.

8.5 Participants send cancellation of queued transaction via their Participant Terminals by

sending to RENTAS Host the MT192 or MT292 for payment instruction and as specified in Clause 9.6 for SSDS instruction.



9.0 Foreign Currency SSDS Processing 9.1 SSDS Initiation and Settlement Deadlines

9.1.1 Participants are required to observe the following deadlines to ensure timely and orderly settlement of SSDS transactions:

9.2 Both buyer and seller shall initiate SSDS transactions through either RBG or SWIFT Access

using the message formats specified in Clause 6.0. 9.3 In a SSDS transaction, the buyer shall initiate a Receive versus Payment message (MT541)

while the seller initiates a Deliver versus Payment message (MT543). DVP Settlement will take place when these two messages are matched, the buyer has sufficient cash balances to pay the seller, and the seller has sufficient securities to deliver to the buyer.

9.4 To reduce Settlement failures arising from minor discrepancies between the purchase

proceeds entered by the buyer in the MT541 message and the sale proceeds entered by the seller in the MT543 message, RENTAS Host will accept a tolerance limit of 5 currency units5. The tolerance range will be calculated based on seller’s proceeds (+/- 5 currency units from the proceeds entered by the seller). If the proceeds entered by the buyer is within the tolerance limit, RENTAS Host will deem the buyer’s MT541 and seller’s MT543 messages as matched and will settle the SSDS transactions based on the proceeds entered by the seller.

9.5 In a SSDS transfer transaction, the transferee initiates a Receive Free of Payment message

(MT540) while the transferor initiates a Deliver Free of Payment message (MT542). Settlement will take place when these two messages are matched and the transferor has sufficient securities to deliver.

9.6 Participants may cancel SSDS transactions that are still pending Settlement as follows:

9.6.1 Matched transactions that are pending Settlement due to insufficient cash or securities;

9.6.2 Unmatched transactions; 9.6.3 Forward-dated transactions with the mutual agreement of both Participants and

their counterparties; 9.7 Participants may initiate new MT 541 or MT543 and indicate ‘CANC’ in field 23 and state

the previous’ original MT541/543 Ref Number of field 20 in field 21 (Related Ref) of the cancellation message.

4 Exemption on instruction deadline for Participants whose clients are Non-resident as they are subject to FEA and AMLA 5 e.g. MYR 5 or CNY 5 or USD 5

Value Date Transaction Initiation Deadlines

Settlement Deadlines

Same Day Value4 By 4 pm on Transaction Day (T) By 5 pm on T

Value Tomorrow By 11 am on T+1 By 3 pm on T+1

Value Spot By 11 am on T+1 By 3 pm on T+2

Forward Value By 11 am on T+1 By 3 pm on T+N



9.8 Participants may cancel Repo transactions only when the first leg has yet to settle due to insufficient repo collateral and/or cash. No cancellation can be initiated after the first leg is settled. SSDS and Repo transactions that are still pending Settlement will be automatically cancelled at Foreign Currency Settlement Cut-off time.

9.9 Processing of Specified and Non-Specified RENTAS Securities

9.9.1 RENTAS Host processes all securities transactions on a real-time basis during Foreign Currency Settlement Business hours. Forward-dated transactions received will be stored in RENTAS Host database and only will be processed on the value date.

9.9.2 If the value date of a payment falls on a Business day that is subsequently declared a public holiday, RENTAS Host shall process such transactions on next Business day.

9.9.3 Although RENTAS Host automatically adjusts the value date of transactions to the next Business day in the event of a holiday, the proceeds of the transactions remain unchanged. PayNet will not input additional days of accrued interest or other adjustments arising from the deferred Settlement due to holidays.

9.9.4 All interest, coupon, dividend and redemption payments will be paid on a Business day. In the event that the interest, coupon, dividend or redemption date falls on a holiday, the payment of interest, coupon, dividend and redemption proceeds shall follow as stated in Part IX (Holiday Convention) of the Operational Procedures for Securities Services.



10.0 Foreign Currency Corporate Bonds and Sukuk (Non-Specified RENTAS Securities)

10.1 Subject to funds availability, all same-day-value and forward-dated transactions shall be credited to or debited from (if there are sufficient funds) the Foreign Currency Settlement Account of the Participants on the same day or on value date, as the case may be.

10.2 All interest, coupon, dividend and redemption payments will be paid on a Business day. In

the event that the interest, coupon, dividend or redemption date falls on a holiday, the payment of interest, coupon, dividend and redemption proceeds shall follow as stated in Part IX (Holiday Convention) of the Operational Procedures for Securities Services.



11.0 Request for Extension of RENTAS Foreign Currency Settlement Cut-off Time

11.1 Participants are required to observe the RENTAS Foreign Currency Settlement Cut-off

schedule at all times to ensure industry-wide operational efficiency. 11.2 However, PayNet may consider extending the Foreign Currency Settlement Cut-off time

when: 11.2.1 The extension of time is requested by BNM or the OSIs under abnormal

circumstances; and 11.2.2 The extension of time is necessary to avoid Settlement failures that pose a systemic

risk to the system. 11.3 Any requests for extension shall be made to PayNet at least fifteen (15) minutes before the

scheduled RENTAS Foreign Currency Settlement Cut-off time. PayNet may reject any request made less than fifteen (15) minutes before the RENTAS Foreign Currency Settlement Cut-off time. In such circumstances, PayNet shall not be held responsible for any losses incurred by the Participants.

11.4 Participants shall inform PayNet for request of extension of cut-off time via telephone by

contacting the Payment Services officers listed in Appendix I (or refer to the updated list in the members’ directory screen in RENTAS iLINK), followed immediately by fax the duly completed form (as specified in Appendix I).

11.5 PayNet will inform the industry through RENTAS broadcast messages in the event of any

extension of cut-off time. 11.6 Participants requesting a Cut-off extension grant PayNet the right to publicly disclose all

information pertaining to the Participants’ cut-off extension request. 11.7 PayNet will not grant an extension exceeding two (2) hours except in circumstances where

PayNet deems the extension necessary to avoid systemic risks to RENTAS. 11.8 Participants who have completed all transactions, repaid all outstanding intraday credit and

settled all obligations to BNM may close their operations at the scheduled cut-off time even if there is a cut-off extension.

11.9 All Participants whose cut-off extension request is granted, will be subjected to a penalty as

specified in Appendix II – Fees and Charges. 11.10 Participants may not “free-ride” on another Participant’s cut-off extension request. If a

Participant requests a cut-off extension and a second Participant subsequent request for a further extension beyond the first request, both Participants will be subjected to penalties for cut-off extension: 11.10.1 The first Participant’s penalty is calculated based on the duration from the

scheduled Foreign Currency Settlement Cut-off time to the extended cut-off time requested by the first Participant; and

11.10.2 The second Participant’s penalty is calculated based on the duration from the scheduled Foreign Currency Settlement Cut-off time to the extended cut-off time requested by the second Participant.



11.11 PayNet will notify the CEOs of all Participants who have incurred penalties for cut-off extensions.



12.0 Incident Report (IR)

12.1 Once PayNet has granted the Participants’ request to extend the Foreign Currency Settlement Cut-off time, Participants are required to submit a complete Incident Report (IR) to PayNet via facsimile or email within twenty four (24) hours of the initial cut-off extension request. (Please refer to Appendix IV for the IR template).

12.2 Apart from IRs for Foreign Currency Settlement Cut-off extensions, Participants are also required to submit an IR to PayNet should there be any incident that materially impacts their RENTAS operations, including major system failure or downtime for more than fifteen 15 minutes, degradation in system performance, security breaches and fraud, delays or disruptions affecting customers, as well as failures to settle obligations.



13.0 Compensation on Inter-Bank Failed Settlements

13.1 Participants are encouraged to resolve any claims for compensation arising from failed Settlements amicably.

13.2 Liabilities for failure to make payments may extend beyond the normal loss of interest of

profit and may include direct, indirect and consequential losses. 13.3 These Operational Procedures do not absolve the paying Participants of any potential

claims that may arise from payment errors or failure to make payments. 13.4 The guidelines for Compensation on Inter-bank Failed Settlements (as specified in Guideline

I) provide a mechanism to compute compensation in situations of Settlement failure or delayed Settlement. The mechanism works on a compensation basis to cover losses. The mechanism is not intended to be punitive as no Participant shall benefit from errors or settlement failure of other Participants.



14.0 Public Key Infrastructure Security Requirements e-PKI

14.1 Participants accessing RENTAS via RBG or RENTAS iLINK shall deploy digital certificates

issued by Licensed Certification Authority (CA) to perform the necessary e-PKI functions in RENTAS. Currently, there are two (2) CAs namely Digicert Sdn. Bhd and MSC Trustgate Sdn. Bhd.

14.2 These digital certificates can be purchased and registered for individuals or organisations

based on the Participants’ internal controls and internal procedures. 14.3 Participants are encouraged to have certificates from both CAs to avoid reliance on a single

CA. 14.4 Participants are also required to have a token-based digital certificate for its e-PKI functions

to activate the RBG backup facility at PayNet’s premise. 14.5 Participants are responsible for monitoring the expiry dates of their respective digital

certificates. They shall renew the certificates at least one (1) month prior to the expiry date of the certificates.

SWIFT Security

14.6 Participants accessing RENTAS via SWIFT Access shall adhere to SWIFT’s security requirements and specifications issued by SWIFT .



15.0 RENTAS iLINK Certificate (ID) Registration

15.1 iLINK is the backup terminal in the event the main channel is unavailable and hence, it is important that all digital certificates of authorized officers who have access to RENTAS must be registered in RENTAS iLINK. This registration must also be performed upon certificate renewal at the end of the certificate validity period. Procedures on the digital certificates registration in RENTAS iLINK are provided in the iLINK User Guide (Appendix XIII).

15.2 Each Participant’s RENTAS iLINK Administrators shall manage all user IDs within their

organisation in accordance with the respective Participant’s internal IT security policies as well as Bank Negara Malaysia’s guidelines and policies.

15.3 Participant’s RENTAS iLINK Administrators shall ensure that access is granted on a need

basis and access should be reviewed periodically to determine if currently assigned access privileges are appropriate. Participant’s RENTAS iLINK Administrators shall promptly revoke User IDs for officers who have resigned, transferred, or whose job functions no longer require access to RENTAS iLINK.

15.4 If a Participant’s RENTAS iLINK Administrator ID has to be removed, the Participant shall

promptly make a request to PayNet by completing the “External User Access Form” in Appendix IX.



16.0 Digital Certificates

16.1 Participants shall liaise directly with the CAs to purchase, renew, suspend or revoke their digital certificates.



17.0 Authenticity, Confidentiality and Irrevocability of the RENTAS Foreign Currency Settlement Messages

17.1 Participants cannot repudiate any transmitted messages or payments that they have digitally signed.

17.2 For forward-dated transactions, a digital signature is verified based on the validity of the

corresponding digital certificate on the date the transaction is initiated. 17.3 If a Participant has revoked a digital certificate, all messages or instructions transmitted by

and signed using the digital certificate prior to the revocation shall be deemed valid. 17.4 Receiving Participants will receive a cryptographic error notification in their RENTAS iLINK

when a transaction fails the digital signature verification. The receiving Participant must then investigate the cause of the digital signature verification failure and validate the integrity and authenticity of the affected transaction manually to independently ascertain the legitimacy of the transaction.



18.0 Billing

18.1 This Clause 18.0 shall be read in accordance with the Fees and Charges section in the Participation Rules for Payments and Securities Services

18.2 PayNet will automatically debit the Participants’ Foreign Currency Settlement Account for

the billed amount on the first Business day of the following month or any time as determined by PayNet.

18.3 Participants shall check their billing advices and inform PayNet of any discrepancies,

including erroneous billing within fourteen (14) days of receipt of the billing statements. 18.4 Participants may refer to Appendix II in this Operational Procedures for detailed fees and

charges for Foreign Currency Settlement Services in RENTAS.



19.0 Online Host Enquiry

19.1 Participants may perform online queries in RENTAS iLINK to obtain up-to-date RENTAS settlement information.



20.0 Retention 20.1 Participants shall retain all Messages, transaction advices, audit trail reports for a period of

seven (7) years.



21.0 Business Continuity Management (BCM)

21.1 Participants are required to conduct BCP and DRP exercises by operating using their Participant Terminals at their respective recovery / DR in accordance with the Guidelines on Business Continuity Management for Participants of PayNet's Services.

21.2 Participants that fail to comply with Clause 21.1 shall be subjected to penalties stipulated in

Appendix I of the Guidelines on Business Continuity Management for Participants of PayNet’s Services.



22.0 BCM Arrangements in Relation to RENTAS Failure

22.1 Participant Terminal Failure

22.1.1 Participant Terminal failure may happen due to system, software, hardware or communication line failure, inadequate or failed internal processes, human errors, power outage or other unanticipated events.

22.1.2 In the event of Participant Terminal disruption, Participants are required to assess

immediately the severity of the failure. Where appropriate, Participants shall invoke the necessary recovery measures to resume normal operations. Participants are reminded that recovery efforts undertaken to resume normal operations shall be within the recovery time objectives (RTO) specified in Guidelines on Business Continuity Management for Participants of PayNet’s Services.

22.1.3 Participants are required to inform PayNet immediately of any Participant

Terminals failures and other disruptions that are affecting their RENTAS system. After the initial notification, Participants are required to update PayNet every thirty (30) minutes on their recovery status and next-action-plan until the terminal resumes normal operation.

22.1.4 Participants shall decide whether to move to its recovery / DR site within sixty (60)

minutes of its terminal failure. 22.1.5 Should a Participant’s primary access channel via RBG or SWIFT Access fail at both

its Live Site and DR Site, Participants may use RENTAS iLINK to access RENTAS. 22.1.6 Participants that fail to comply with the requirements in Clause 22.1.2 shall be

subjected to penalties stipulated in Appendix I of the Guidelines on Business Continuity Management for Participants of PayNet’s Services.

22.2 OSI Unable to Transmit Opening Balances to PayNet

22.2.1 If an OSI is unable to transmit opening balances for the Participants’ Foreign Currency Settlement Account to PayNet (via SWIFT MT198 messages), the affected OSI shall immediately key in the opening balances via RENTAS iLINK to update the Participants’ opening balances.



22.2.2 However, if OSI is not able to access iLINK and is not able to transmit MT198 messages to provide opening balances for the Foreign Currency Settlement Account, the OSI shall inform PayNet of the failure before 11:00 pm on the night preceding the new Business day.

22.2.3 OSI will then be required to perform the following contingency measures via

RENTAS iLINK at PayNet’s premises: 22.2.3.1 OSI are required to mobilise sufficient staff to undertake the contingency

operations at PayNet’s premises. 22.2.3.2 OSI must seek PayNet’s approval prior the activation of contingency

measures and must arrive at PayNet’s premise within one (1) hour from the approval time.

22.2.3.3 OSI to use the file upload function in iLINK to upload the Opening Balance file.

22.2.3.4 OSI are required to bring all relevant documents as stated in Appendix XII, Checklist for the RENTAS BCP Live Run and Activation of 3rd BCP at PayNet.

22.3 OSI is Unable to Provide Opening Balances to PayNet

22.3.1 If an OSI is not able to provide the opening balances for the Foreign Currency Settlement Account, PayNet will use the closing balance of the Foreign Currency Settlement Account on the previous Business day as the opening balance for the new Business day.

22.4 PayNet is Unable to Provide Closing Balances to OSI

22.4.1 PayNet will provide the closing balances by fax or e-mail in the event that the system is unable to transmit the closing balances.



24.0 RENTAS Host Failure at Production Site 24.1 To minimize the risk of disruption to the settlement operations of Participants, RENTAS

Host runs on fault tolerant technology, which allows the system to continue functioning uninterrupted when individual system components fail. In addition, PayNet maintains a RENTAS Host at BNM’s Recovery Centre that is updated in real-time so that all data and transactions are identical to the RENTAS Production system.

24.2 In the unlikely event of RENTAS Host failure at Live Site, PayNet shall make use of e-mail,

WhatsApp, SMS or BCP call tree to keep Participants updated on the recovery status and action plan every thirty (30) minutes until the RENTAS Host resumes normal operation.

24.3 If PayNet decides to move its RENTAS Host operations to its Recovery Centre, the activation

of the RENTAS Host at the Recovery Centre can be completed within two (2) hours.



25.0 e-PKI Failure

25.1 RENTAS Host is designed to withstand the complete failure of e-PKI. As such, the failure of e-PKI would largely be transparent to Participants. All transactions would remain protected using a backup security solution which provides data authenticity, integrity and non-repudiation features, thus ensuring the security of RENTAS at all times.

25.2 To ensure seamless and automatic activation of the backup security solution, Participants

shall ensure that the e-PKI configuration at their Participant Terminals is in accordance with PayNet’s specifications.



26.0 Network Connectivity Failure

26.1 In the event RENTAS Participant encountered network connectivity failure affecting Participant’s RENTAS access channels at Production Site and/or Recovery Centre, RENTAS Participant may request to activate RENTAS iLINK over the Internet as the contingency access channel

26.2 RENTAS Participant must ensure that all applicable settings in RENTAS iLINK such as user’s

access matrix, users’ transaction approval limit, global approval limit and TRN maintenance screens are configured accordingly.

26.3 RENTAS Participants are advised to review the settings in RENTAS iLINK periodically to

ensure the settings are up-to-date and able to support their latest transactional and operational needs in RENTAS.

26.4 RENTAS Participant must send a request to activate RENTAS ILINK to PayNet via email at

[email protected]. RENTAS Participant must also update PayNet via email to deactivate RENTAS iLINK after RENTAS Participant reverts to normalcy.

26.5 If activating RENTAS iLINK from Participant’s site is not feasible, Participants may activate

RENTAS iLINK at PayNet’s office as a last resort.




27.0 Testing Procedures

27.1 Participants are allowed to use PayNet’s RENTAS Host test environment, if the need arises. 27.2 Participants shall submit their request to use the test environment by submitting the form

in Appendix X at least three (3) Business days prior to the scheduled testing. 27.3 The value date of the exercise shall default to the current value date, unless the Participant

requests a different value date. Requests for a value date other than the current date will only be entertained on a case-by-case basis.

27.4 Fees imposed on Participants for use of the test environment is as stated in Appendix II. The

fees will be levied based on the number of days of the planned exercise. Participants will not be reimbursed if the planned exercise is not conducted. If a request is made less than three (3) Business days prior to the test, the request will be deemed as an unplanned testing exercise for billing purposes.

27.5 Participants are not allowed to use the RENTAS testing environment during RENTAS live

runs, weekends, public holidays and after office hours. 27.6 PayNet may also conduct RENTAS test exercises and reserves the rights to make the testing

mandatory for some or all Participants based on the objectives of the test exercise. 27.7 In the testing where the test scripts are to be provided by PayNet, the test scripts will be

made available at least one (1) week before the actual exercise date.



28.0 User Manuals 28.1 User manuals for RENTAS Foreign Currency Settlement shall be provided by PayNet or its

designated vendors.



29.0 RENTAS Participants Directory

29.1 Participants shall furnish their latest contact information for business continuity purposes by updating the Member Directory in RENTAS iLINK. An up-to-date contact list is an essential component of BCP.

29.2 Participants shall maintain an updated list of authorized signatories using the form in

Appendix VIII.



30.0 Customer Service

30.1 Participants may contact PayNet with regards to any RENTAS issue. The contact details for PayNet’s Operations are as per Appendix I. The contact information is also available in the Member Directory in RENTAS iLINK system.



Guidelines Guideline I - Compensation on Inter-bank Failed Settlements 1.0 Principle and Scope 1.1. In the event of delayed payment or Settlement failures for foreign currency transactions, a

mechanism for computing compensation is provided in this Guideline. The mechanism works on a compensation basis to cover losses. The mechanism is not intended to be punitive, as no Participant shall benefit from the errors or Settlement failures of other Participants.

1.2. The paying Participant shall compensate the receiving Participants for loss of interest

income arising from the errors made by the paying Participant. While it is the responsibility of the paying Participant to make payments, the receiving Participant may also advise the paying Participant if any payments expected are not paid in due time.

1.3. Payments are normally made for the following reasons:

1.3.1. From the paying Participant’s own account and such payments are made for the credit of the receiving Participant as beneficiary (e.g. Settlement of Foreign Exchange or Money Market transactions);

1.3.2. On behalf of the paying Participant’s customer and such payments are made for the credit of the receiving Participant as beneficiary (e.g. overdraft or loan repayment);

1.3.3. From the paying Participant’s own account and such payments are made for the credit of the receiving Participant’s customer; and

1.3.4. On behalf of the paying Participant’s customer and such payments are made for the credit of the receiving Participant’s customer.

1.4. Foreign Currency Inter-bank failed payments are defined as:

1.4.1. Payments that do not meet the Foreign Currency Settlement Cut-off time for payments and settlements set out in the Foreign Currency Settlement Business hours stated in Clause 7.2 of this Operational Procedure;

1.4.2. Mis-sent payments; and 1.4.3. Non-payment.

2.0 Compensation on Foreign Currency Inter-bank Failed Payments

Participants shall be guided by the following procedures in regard to the compensation on failed Foreign Currency inter-bank payments:

2.1 Compensation Coverage

2.1.1. If, for any reason, a payment error causes the receiving Participant to breach any of BNM’s regulatory requirements or PayNet’s Rules and Operational Procedures, and the receiving Participant is able to show proof that such non-compliance was a direct result of the error from the paying Participant, the compensation shall include the payment of any penalty imposed by BNM and PayNet over and above the compensation computed based on the prescribed formula under Clause 2.2 of this Guideline.

2.1.2. Other costs and charges, such as forex cover, cable charges etc. shall be excluded

when computing compensation for inter-bank payment errors.



2.2 Compensation Computation Formula

2.2.1. The paying Participant making any request should inform the receiving Participant of the details of the payment to which such request relates and the particulars of the account to which it should be credited.

2.2.2. Late Intra-day Money Market Transaction

2.2.2.1. When payment is not effected within thirty (30) minutes of the

transaction, the borrowing Participant / Investee will be entitled to compensation according to the compensation formula below: where, Amount of Payment = Amount due for the Settlement of the foreign

currency transaction Compensation Rate: i. For RMB payment, the compensation rate is the average of each

day’s overnight rate of the Shanghai Interbank Offered Rate (SHIBOR) published by the National Interbank Funding Center in Shanghai.

ii. For USD payment, the compensation rate is the average of each day’s Federal Funds rate as published by the Federal Reserve Bank of New York. The daily Federal Funds rate for any day on which a published rate is not available shall be deemed to be the same as the immediately preceding published rate.

iii. For other currencies, the compensation rate will be determined as and when new currencies are added in RENTAS.

Day = Delay will be deemed as one (1) day for compensation

calculation

2.2.2.2. When payment for an Intraday money market transaction has not been effected on value date by the Lending Bank / Investor, the Intraday money market transaction would be deemed as a failed trade and no Settlement will take place. Under such circumstances, the Borrowing Participant / Investee will be entitled to claim compensation according to the following compensation formula:

where, Amount of payment and compensation rate are as defined in Clause 2.2.2.1 Day = Delay will be deemed as one (1) day for compensation

calculation

2.2.3. Value Date Adjustment / Use of Funds Compensation Claim Formula

2.2.3.1. For value date adjustment of the payment and the use of funds, the compensation claim will be paid according to the formula in Clause

Amount of Payment x Compensation Rate x Day 360

Amount of Payment x Compensation Rate x Day 360



2.2.2.2 i. For back valuation of a USD payment, if the receiving Participant

back values the payment pursuant to the request of the sending Participant, the receiving Participant’s claim for compensation will be according to the following formula:

+ USD300

ii. For forward valuation of a USD payment, if the receiving

Participant adjusts the payment to a future value date pursuant to the request of the sending Participant, the receiving Participant must, upon receiving a claim for compensation, pay the sending Participant compensation according to the following formula:

- USD300

Day = Number of days Back or Forward Valued

2.2.4. Mis-sent Payment 2.2.4.1. A paying Participant may request the receiving Participant to return

funds under the following circumstances: i. If the payment has not been sent; ii. The payment was directed to a wrong Participant; and iii. A duplicate payment / overpayment has been effected.

2.2.4.2. If the paying Participant notifies the receiving Participant of a mis-sent

payment, the principal sum shall be returned by the receiving Participant under the following conditions: i. The paying Participant shall confirm details of the mis-sent

payment by transmitting a SWIFT message, email or any other means of notification to the receiving Participant;

ii. The paying Participant shall include date and details of the mis-sent payment in the notification;

iii. The paying Participant shall forward to the receiving Participant copies of the advices or its equivalent, for the mis-sent payment via facsimile, e-mail or any other means;

iv. The paying Participant shall provide an indemnity to the receiving Participant;

v. The receiving Participant may return the funds without beneficiary’s consent if the sum has not been credited to the beneficiary’s account;

vi. If the sum has been credited, the receiving Participant shall only return if: - Both the receiving Participant and the paying Participant

are fully satisfied that the beneficiary’s account had been credited erroneously; and

- The funds are still in the beneficiary’s account; vii. The receiving Participant shall notify the beneficiary on the

erroneous credit prior to debiting the account; and viii. The refund is executed by initiating a new transaction since the

mis-sent transaction settlement is already final and irrevocable.

Amount of Payment x Compensation Rate x No. of Days 360

Amount of Payment x Compensation Rate x No. of Days 360



The receiving Participant making the refund to the paying Participant shall be entitled to an indemnity from the paying Participant. The nature of indemnity is intended to protect the receiving Participant from any risk, loss or cost as a result of the paying Participant having entertained a request by its customers to “cancel” a prior payment to the account of the receiving Participant’s customers. As such, paying Participant is advised to execute the indemnity only for its own payment errors and to be cautious in executing its customers’ request to recall payments which may be under the guise of mis-sent payments.

2.2.4.3. If a wrong payment is made before or at Settlement Cut-off time, the receiving Participant will, on a best effort basis, return the funds on the same day at no cost to either party. However, if the funds are returned before Settlement Cut-off time on the next Business day, the paying Participant is entitled to the use of funds from Day 1 onwards, i.e. the day the wrong payment was made.

2.2.4.4. If the wrong payment is made after Settlement Cut-off time, the

receiving Participant has up to the Settlement Cut-off time on the next Business day to return the payment at no cost to either party. However, if the funds are not returned by the Cut-off time the next Business day, the paying Participant will be entitled to use of funds from Day 2 onwards, i.e. the day following Day 1 (please refer to Clause 2.2 of this Guideline for the “use of funds” compensation claim formula).

2.2.5. Late Payments / Repayments

2.2.5.1. Funds received after the scheduled Settlement Cut-off time will be considered as next day value. Therefore, the receiving Participant shall be entitled to compensation based on the “Value Date Adjustment” formula as per Clause 2.2.3 of this Guideline.

2.2.5.2. The receiving Participant need not return the funds in order to claim

the compensation.

2.2.6. Unable to Apply Funds Received

2.2.6.1. When the receiving Participant receives a payment and is unable to apply the funds due to discrepancies or insufficient details in the payment instruction, the procedure would be as follows: i. The receiving Participant shall return the funds to the paying

Participant immediately; ii. The paying Participant may, however, request the receiving

Participant to hold back the funds pending rectification; iii. The receiving Participant may entertain this request at its

discretion and retain the funds provided the paying Participant sends a notification immediately to the receiving Participant with the notation as stated in Clause 3.0; and

iv. To rectify the payment instructions, the paying Participant must send another notification to the receiving Participant with the notation as stated in Clause 3.0.



3.0 Indemnity 3.1 In all cases where the receiving Participant returns, rectifies or withholds payments to or

to the order of the paying Participant pursuant to the request of the paying Participant under Clauses 2.2.4.2 and 2.2.6 of this Guideline, the paying Participant shall indemnify the receiving Participant according to the terms set forth in this section.

3.1. The indemnity Clause below is automatically binding on the paying Participants regardless

whether it is stated or not in the MT198 CRN messages.

“We indemnify you pursuant to paragraph 3 of the Guidelines on Compensation on Inter-bank Failed Settlements for returning payment / rectifying payment / withholding payment instructions."

3.3. The paying Participant shall return on demand by the receiving Participant, all payment

amounts returned or refunded by the receiving Participant pursuant to the request of the paying Participant. The paying Participant shall further indemnify the receiving Participant, its employees and agents against and all claims, liabilities, losses, expenses (including all legal fees and disbursements), suits or damages arising from the breach of this undertaking.

3.4. This Indemnity shall apply and be enforceable even if the receiving Participant effects a

Settlement or compromise with regard to any claim for losses, damages and expenses without recourse to litigation if the receiving Participant deems fit. The paying Participant shall also pay to the receiving Participant all costs and expenses incurred in enforcing this Indemnity obligation and in taking legal advice in connection with this indemnity (including all legal fees and disbursements).

4.0 Validity of Compensation Claims

4.1. A compensation claim is deemed valid only if it is initiated within sixty (60) calendar days

from the value date of the transaction.



Guideline II - Guidelines on Handling the invalid characters in RENTAS

1.0 Introduction

1.1 These guidelines are intended to standaradize the replacement of invalid special characters

in RENTAS.

2.0 Valid Special Characters in RENTAS

2.1 The following special characters are the only valid characters to be used in RENTAS

/ - ? : ( ) . , ‘+ SPACE CrLf

2.2 Participants shall map and replace these special characters that are not valid in RENTAS

Invalid Special Characters To Replace with

@ ALIAS or / or SPACE

& AND or /

% PCT or / or SPACE

Other Characters ?



Appendices Appendix I - RENTAS – Contact Details PayNet Payment Services (Application of Membership, Opening of Securities Account and Customer Services):

Office Addresses and Contact Details:

Live Back-up / Recovery Centre

Address Payments Network Malaysia Sdn.

Bhd. (PayNet)

Large Value Payments and Securities

Services Division

Level 8, Tower 5

Avenue 3, Bangsar South

8, Jalan Kerinchi

59200 Kuala Lumpur

BNM Recovery Centre

Lot 1064, Subang Hi-Tech Industrial

Park

Off Jalan Delima 1/1

40150 Batu Tiga

Selangor

Telephone Number 03-22648668

03-56378575

03-56378446

03-56378227

Fax Number 03-27818588

03-56357944

E-mail address [email protected]

OSI Contact Details at Bank of China (M) and CIMB (Opening of Foreign Settlement Account and Customer Services):

OSI Name Phone Number Email Address

OSI RMB

Yeong Hong Ping 03-2387 8121 [email protected]

Yong Fee Yen 03-2387 8139 [email protected]

Chang Tuck Choon 03-2387 8154 [email protected]

OSI USD

Alex Yee Tat Choy 03-2261 7632 [email protected]

Choong Chen Fan 03-2261 7711 [email protected]

Edward Yap 03-2261 9875 [email protected]

Beh Sui Chung 03-2261 9733 [email protected]






Appendix II – Fees and Charges for Foreign Currency Settlement

No. Description Amount (MYR)

1.0 Annual Membership Fee:

Type

I Licensed financial institutions regulated or co

regulated by BNM and Institutions under BNM’s

purview

II Development Financial Institutions and entities

admitted for market development purposes

15,000.00

III ICSDs and CSDs

IV Foreign central banks

V Qualified foreign financial institutions and multi-

lateral institutions

VI Clearing houses

VII Qualified local corporates

2.0 Inter-bank Funds Transfer (IFTS)

a. Amongst Participants 2.50

b. For third party 1.50

3.0 Debit/Credit Notification

a. Amongst participants 2.00

b. For third party (effective 1st September 2019) FOC

4.0 PvP fee 7.00

5.0 Scripless Securities Sale, Free of Payment and House

Transfer Transactions (payable by both buyer and seller)

1.00

6.0 Scripless Securities REPO Transaction (payable by both

buyer and seller)

1.00

7.0 Securities Borrowing and Lending Transaction 2.00

8.0 Central Host On line Enquiry 2.00

9.0 Administrative Message 2.00

10.0 Transaction fee for use of intraday credit (per tranche of

RM5 million)

12.00

11.0 Request for report after cut-off time (per page) 50.00

12.0 Failure to settle intraday credit by the designated system

cut-off time**

Note:

All Participants making requests for cut-off extension will

be charged

5,000 per event

13.0 Charges for the use of PayNet back-up facility in 12

months:

• 1st 1,000.00

• 2nd 2,000.00

• 3rd 3,000.00

• Subsequent

Note:

5,000.00



No. Description Amount (MYR)

1. Requests within a Business day is counted as one

activation

2. The 12 months period starts from first activation

14.0 Late payment- Redemption (early / full / partial) or coupon

payment**

5,000 per incident

15.0 Use of RENTAS CHS Testing Environment

a. Planned 200.00

b. Unplanned 400.00

16.0 Penalty for causing delays to the settlement of clearing

positions for eSPICK, MyDebit, RPP, , MEPS Cash, Shared

ATM Network (SAN), Interbank GIRO, FPX or Direct Debit

clearing positions:**

5,000 per incident

For purposes of determining the number of delays, the

incidents of delays would be calculated separately for each

type of clearing.

17.0 Cut-off extension fee:**

a. 1st request every half hour, or part thereof 5,000.00

b. 2nd request onwards within a year* - every half hour,

or part thereof

(*Note- 12 months calendar year)

10,000.00

18.0 Onsite Consultancy Fee*** Minimum 600 per

visit and

RM300/hour for

subsequent beyond

2 hours

19.0 “General Non-Compliance” as defined in Appendix XIV

(Glossary of Terms)

Up to 5,000

* The annual membership fee is charged by Participant and not by currencies. By default, the MYR charges would be applicable unless the Participant does not participate in the MYR Settlement. **Penalties channelled to the ePayment and Market Infrastructure Development Fund ***Includes training and other relevant support and services Note: a. A Participant who participates in both MYR Settlement and CNY Settlement will pay a single

annual membership fee of RM15,000.00 only, as well as other fees denoted in the MYR column. b. Billing for Participants that are incorporated in Malaysia shall be in MYR. Foreign Participants

could opt for: i. billing in the currency of the settlement service in which they are participating; or ii. billing in MYR

c. All fees (excluding penalties) for CNY and USD settlement in RENTAS as specified above are currently waived. Penalties are not waived.



No. Description Amount (EUR)

20.0 SWIFT Messaging Fees a. Non-reporting fees* b. Reporting fees**

Reverse billing would be adopted where all SWIFT messaging fees payable when RENTAS CHS sends messages to Participants would be charged to the receiving Participant. The fees are in accordance with SWIFT pricing and may be revised if SWIFT revises its fees. *Participant initiated instruction message (MT103, 202, 198, 540, 541, 542, 543 etc). Charged to Participant initiating. **SWIFT-generated statement of holdings, listing of transactions, and allegement (MT535, 536, 548, 578, 940, 941, 950, etc.). Charged to Participant requesting report.

As charged by

SWIFT



Appendix III – Request for Extension of RENTAS Foreign Currency Settlement Cut-off Time

(Please use institution’s letterhead) Date:

To : Director

Large Value Payments and Securities Services Payments Network Malaysia Sdn. Bhd. (PayNet) Level 8, Tower 5 Avenue 3, Bangsar South 8, Jalan Kerinchi 59200 Kuala Lumpur

From : (RENTAS BIC) Subject : Request for Extension of Foreign Currency Settlement Cut-off Time Kindly extend the Foreign Currency Settlement Cut-off Time

from p.m. to p.m. (ddmmyyyy) We hereby agree to pay the charges applicable for the extension. The reason(s) for our request for extension is/are as follows:

Thank you. (Authorised Signatory) (Authorised Signatory) Official Stamp: For PayNet Payments Services Use Only

Message received by:

Request allowed/disallowed by:

Time :

Fees Payable :



Appendix IV - Incident Report from Participants

(Please use institution’s letterhead)

Date: To : Director


From : (RENTAS BIC) Subject : Incident Report From Participants Attached herewith the Incident Report for your attention and / or further action:

System Affected RENTAS / eSPICK (please circle one)

From

Date of Report (to send latest one day after the incident)

Date and Time of Incident

Chronology of Incident

Causes

Action Taken

Preventive Measures

Information Required:

Total No of Transactions Pending

Total Value of Transactions Pending (in Currency Code)

Amount of Settlement Failure (in Currency Code)

No of Counter-parties affected

Name:

Designation:

(Refer to authorised signature list – highest ranking)



Appendix V - Request To Re-sequence or Cancel Payment Instructions In Priority Queue


Date : To : Director


From : (RENTAS BIC) Subject : Request to Re-sequence or Cancel Payment Instruction(s) in Priority Queue Kindly re-sequence / cancel* the following transactions in our Priority today:

Queue No

ISN No Currency

Code

Amount

TRN

New Queue No.

The reason(s) for our request is / are as follows:

Thank you. (Authorised Signatory) (Authorised Signatory) Official Stamp:

For PayNet Payments Services Use Only

Message received by:

Request allowed / disallowed by:

Time :

Fees Payable :


© 2019 PayNet. Confidential. Page: 66 of 83

Appendix VI - Form A: New Participant


Date : To : Group Chief Executive Officer


From : (RENTAS BIC) Subject : Confirmation of Participation

We refer to the application on the above.

1. We confirm our participation in the RENTAS system for (indicate all that are applicable)

MYR Payments Services only;

MY MYR Settlement Services, both payments and securities;

Foreign Currency Payment Services only (specify currencies:_________________);

Foreign Currency Settlement Services, both payments and securities

(specify currencies: _______________________________________________);

Securities Services only. We appoint the following institution as the authorised agent to manage and operate our daily operation for both securities transactions and the corresponding payment transactions in the RENTAS system.

Name of Agent Currency

Cross-Border Securities Custody Services 2. As the owner of the stipulated account(s) in RENTAS, we hereby agree to abide by all rules, operational

procedures and guidelines issued by Bank Negara Malaysia and/or PayNet from time to time. 3. We hereby authorise PayNet to debit our Foreign Currency Settlement Account maintained at the

appointed on-shore settlement institution. 4. We hereby authorise PayNet to disclose information pertaining to my organisation’s debt securities

holdings under all custody codes in RENTAS to facility agents for the specific purpose of administering the debt securities.

Yours sincerely,

...........................................................

(Signature of Chief Executive Officer) Name: For and on behalf of: Official stamp:



Appendix VI - Form B: Existing RENTAS Participant Extend Membership to Foreign Currency Settlement Service


Date :

To : Group Chief Executive Officer


From: (RENTAS BIC) Subject : Confirmation of Participation in Additional Services

We refer to the application on the above.

1. We wish to extend our participation in RENTAS to:

MYR Payments Services only;

MYR Settlement Services, both payments and securities;

Foreign Currency Payment Services only (specify currencies: _____________);

Foreign Currency Settlement Services, both payments and securities

(specify currencies: _______________________________________________);

Securities Services only. We appoint the following institution as the authorised agent to manage and operate our daily operation for both securities transactions and the corresponding payment transactions in the RENTAS system.

Name of Agent Currency

Cross-Border Securities Custody Services 2. As the owner of the stipulated account(s) in RENTAS, we hereby agree to abide by all rules,

operational procedures and guidelines issued by Bank Negara Malaysia and/or PayNet from time to time.

3. We hereby authorise PayNet to debit our Foreign Currency Settlement Account maintained at the appointed on-shore settlement institution.

4. We hereby authorise PayNet to disclose information pertaining to my organisation’s debt securities holdings under all custody codes in RENTAS to facility agents for the specific purpose of administering the debt securities.

Yours sincerely,

........................................................... (Authorised Signature and Institution Official Stamp) Name: Designation:



Appendix VI - Form C: Confirmation of Access Channel for Foreign Currency Settlement in RENTAS


Date :

To : Group Chief Executive Officer


From: (RENTAS BIC) Subject : Confirmation on Access Channel for Foreign Currency Settlement in RENTAS

With reference to the above, we would like to confirm that the following access channel will be used by

our institution for Foreign Currency Settlement in RENTAS:

RENTAS iLINK

RENTAS Bank Gateway

SWIFT Alliance Access via SWIFTNet

Both RENTAS Bank Gateway and SWIFT Alliance Access. Please specify which of the following

system will be used as primary access channel:

RENTAS Bank Gateway

SWIFT Alliance Access

Other Messaging Software via SWIFTNet. Please specify:

________________________________________________

Thank you.

Yours sincerely,

................................................................ (Authorised Signature and Institution Official Stamp)

Name:

Designation:



Appendix VII - Contact Person for Daily Operation of RENTAS


Date : To : Group Chief Executive Officer


From : (RENTAS BIC) Subject : Contact Person for the Daily Operation of RENTAS

Please be informed that the following is our contact person of RENTAS system and the details are given as follow: Institution Name:

Name of the contact person:

Specimen signature of contact person:

Designation:

Department:

Contact address:

Contact telephone number:

Email address:

Yours truly,

(Authorised Signature and Institution Official Stamp)

Name:

Designation:



Appendix VIII - RENTAS – Authorised Signatories List


Date:……………………………. To : Group Chief Executive Officer


From : ……………………………………… (RENTAS BIC) ………………………………………. (RENTAS Digit Code) Subject : RENTAS – Authorised Signatories List

We submit herewith our Authorised Signatories List for all RENTAS matters referring to the member

institution. This list shall take effect on ……………………………………………….

Name Designation Specimen Signature

Yours sincerely,

...........................................................

(Authorised Signature and Institution Official Stamp)

Name: .................................................................

Designation: .................................................................

This signatories list must be authorised by the person who has the Power of Attorney (PA) or based on the Board of Directors’ resolution.



Appendix IX – EXTERNAL USER ID ACCESS REQUEST FORM

Note: 1. All fields are compulsory 2. Please write legibly & where applicable 3. Date format: dd/mm/yyyy Section 1 (to be completed by Requestor-External User)

Name:

Employee No:

Identity Card No.:

Designation/Department:

Bank / Organization Name:

Bank / Organization Address:

City: Postcode:

State: Country:

Contact No. : Email Address:

Status: Permanent Temporary, From (Date): To:

System/Application:

a. IBG / Direct Debit

Payswitch Application IBG Direct Debit

FI Report Server* IBG Direct Debit

* IP Address:____________________________ (Registered with TM and to be registered at PayNet Firewall)

b. DDA DMS

Bank Approver Bank Enquiry

FI Report Server*


c. FPX

FI Report Server (Bank Only)

FPX –TPA Webview

FPX Webview* (BANK) Maker (Admin) Authorizer (Admin)

FPX Webview* (MERCHANT) Maker (Admin) Authorizer(Admin)


*Exchange ID : EX _________________ *Seller ID : SE _________________

d. JomPAY BANK Administrator

Checker Maker

FI Report Server*

BILLER Administrator

Checker Maker

SMTP Server


e. CIT

eService

EWIDT

IP Address:____________________________ (Registered with TM and to be registered at PayNet Firewall)

f. SAN / MyDebit Reports

SFTP


g. RPP

Back Office – Application Web

FI Report Server


h. DLS / ECMS

Domestic SAN Issuer Maker Authorizer HOD

Cross-border (CBPOS)

Domestic SAN Acquirer Maker Authorizer HOD

Cross-border

Domestic SAN Beneficiary Maker Authorizer HOD

Cross-border Switch Partner



Issuer Maker Authorizer HOD

MyDebit Issuer Maker Authorizer HOD

Acquirer Maker Authorizer HOD

MyDebit Acquirer Maker Authorizer HOD

Beneficiary Maker Authorizer HOD

i. RENTAS

RENTAS RSG RENTAS Swift

RENTAS iLINK eSPICK

RENTAS Mini FAST eSSDS

j. Others Please specify: ________________

Public IP* MPLS IP


Environment: SIT UAT CRT Production Disaster Recovery

Request to:

Create ID Delete/Revoke ID* Suspend/Disable ID* Activate/Enable/Unlock ID*

Reset Password* Modify ID* Task Assignment*

Token Registration* Subject Key Identifier (SKI) No : ______________________________________ *please specify User ID: _____________________ *modify ID, specify the new profile: ________________________

Reason for request:

Signature: Date:

Approval (by Bank’s Authorized Signatories)

Request: Approved Not Approved (Please indicate in remarks column below)

Remarks:

Name:

Designation/Department:

Contact No.: Email Address:

Signature: Date:

Section 2 (to be completed by PayNet) Part A – For Business / System Owner Approval Part B – Head of IT Security Approval (If Applicable)

Request: Approved Not Approved Request: Approved Not Approved

Signature: Signature:

Name: Name:

Date: Date:

Part C– System Access Control Administrator Action (Maker)

Part D – System Access Control Administrator Review (Checker)

Request: Completed Rejected Further Review: Yes No

Signature:

Signature:

Name: Name:

Date: Date:



Appendix X – Request Form for RENTAS Test Environment

1. Requester’s Information

Name: Bank Name:

Date: Digit Code:

Department: BIC Code:

Contact No.: Access Channel: SAA RBG iLINK E-mail:

2. Specify date(s) needed (please tick):

Month:

January July February August March September April October May November June December

Day:

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

3. Services:

MYR CNY

PV (On Shore PVP MYR-CNY) DV HK (Off Shore PVP MYR-USD)

Remarks: [Test purposes / additional request]

Management Approval (must be an Authorized Signature)

Signature:

Name:

Position:

Date:

Institution Stamp:

3. For PayNet Internal Use Only

Date Received:

Approved by:

Charge Amount:

Remarks:

Note:

1. Participants are required to adhere to Testing Procedure as stipulated in Operational Procedure for MYR Settlement in RENTAS.

2. Participants are not allowed to use the RENTAS testing environment during RENTAS live runs, weekends, public holidays and after office hours.



Appendix XI – Supported Foreign Currency Foreign Currency Settlement supported in RENTAS is as follows

No Currency Currency Code Appointed On-shore Settlement Institution

1 Chinese Renminbi CNY Bank of China (Malaysia) Berhad

2 United States Dollar USD CIMB Bank Berhad6

6 Effective date will be announced via email to all Participants



Appendix XII - RENTAS BCP Live Run and Activation of 3rd BCP at PayNet Checklist RBG BCP Live Run Checklist:

• Participants must at all time refer to RBG Fail Over Operation Manual Procedures provided by Finexus.

Activation of 3rd BCP at PayNet (RBG or iLINK) Checklist: 1. Participants shall inform PayNet via email regarding the activation.

2. Participants must ensure they bring along the following:

2.1 ePKI tokens as per registered in RENTAS system (refer Clause 14.0) 2.2 Source files or documents of the outstanding transactions

3. PayNet/Vendor to do the following: 3.1 Start Windows Service 3.2 Ensure web application readiness

4. Participants to start connection and upload/key in transactions



Appendix XIII – Guideline for Registration of New Digital Certificate in RENTAS iLINK

1.0 Introduction

1.1 This guideline is to provide a proper steps for the purpose of registering new digital certificate via RENTAS iLINK.

1.2 RENTAS Participants required to have two (2) users to register new digital certificate in

RENTAS iLINK. Details are as follows: i. User 1 – To validate and add new certificate for registration. User 1 requires to have

function to add new certificate in RENTAS iLINK.

ii. User 2 – To approve the registration of new certificate. User 2 requires to have the approval function and active certificate in RENTAS iLINK.

2.0 Steps to Register New Certificate via RENTAS iLINK

2.1 Log-in RENTAS iLINK as User 1 and complete the following actions:

i. Go to Admin > Certificate Registration Maintenance;

ii. Select Participant’s BIC and click button ‘Add’;

iii. At the ‘Search By’ field, user may select any of the preferable option to search the new certificate. Select the preferable option and provide the details at the key search. Then click button ‘Enquiry’. Example as follow:

iv. Details of new certificate will be prompted. Select the certicate and click button ‘Submit for Approval’ at the bottom of the screen. Example as follow:

2.2 Log-in RENTAS iLINK as User 2 and complete the following actions:

i. Go to Admin > Certificate Registration Maintenance;



ii. Select Participant’s BIC and click button ‘Approve’;

iii. The submitted certificate (submitted by User 1) will be prompted on the screen. User

2 to select the certificate and further click button ‘Approve’ at the bottom of the screen;

iv. Details certificate will be prompted on the screen and User 2 to validate the details such as name, IC number, email address, subject key identifier etc. Then click button ‘Submit’;

v. Screen will prompt message to remind user to plug-in token and require user to insert the PIN number (password) of the token. Next system will proceed and approve the certificate accordingly. Status of the certificate will display as ‘Active’.



Appendix (XIV) – Glossary of Terms

1. “Allegement” refers to a message that RENTAS transmits to inform a Participant’s

counter-party that a foreign currency securities transaction that the Participant

transmitted cannot be matched.

2. “BNM” means Bank Negara Malaysia established under the Central Bank of Malaysia Act

2009.

3. “Business Continuity” means the continued delivery of services and continued

operational viability in response to a disruptive event.

4. “Business Continuity Management (BCM)” means a holistic management process that

identifies risks, threats and vulnerabilities thst could impact an organisation’s business

operations and which ensures organisational resilience and Business Continuity.

5. “Business Continuity Plan (BCP)” refers to a comprehensive documented action plan

that outlines the procedures, processes and systems necessary to resume or restore the

business operations of a Participant in the event of a disruption.

6. “Business day”, unless otherwise specified in these Operational Procedures, means any

calendar day from Monday to Friday, except a public holiday in the federal territory of

Kuala Lumpur.

7. “Business hours” means the duration of time, from the opening time to the closing

time, when PayNet provides Payments and Securities Services, which may differ for each

of the Payments and Securities Services.

8. “Clearing” means the process of exchanging and reconciling payment items that result in

the establishment of final positions for Settlement.

9. “Credit Notification” refers to a notice sent by Participant to another Participant

informing them of impending RENTAS payment.

10. ”Cut-off time” refers to the stipulated time, fixed by PayNet; beyond which the receipt

of any item will be deemed to occur at the opening of the next working day.

11. “Debit Notification” refers to notification sent by RENTAS to the FA on the coupon or

redemption payment date for Debt Securities informing the FA on the total interest or

redemption proceeds that the FA has to pay to BNM on behalf of the issuer.

12. “DFI” means Development Financial Institutions that are governed under the

Development Financial Institutions Act 2002.

13. “Digital signature” means the cryptographic process where Messages are signed with

the sender’s private key so that the recipient of the Message, by using the public key to

decrypt, can accurately determine the authenticity and validity of the Message.



14. “DvP” means delivery-versus-payment in which transfer for securities and funds is

settled on a trade-by-trade basis, with final transfer of the securities from the seller to

the buyer (delivery) occurring at the same time as final transfer of the funds from the

buyer to the seller (payment).

15. “Eligible Securities” means:

a. Specified RENTAS Securities issued by the Government and BNM; and

b. Non-specified RENTAS Securities with minimum credit rating of AAA and above.

16. “e-Payment and Market Infrastructure Development Fund” means a fund consisting of

penalty charges collected from Participants and PayNet, which was established and is

managed by PayNet, and is dispersed for initiatives that are beneficial to Participants.

17. “e-Payment Incentive Fund Framework” or ePIF is a framework established by BNM to

drive improvements in the e-payment infrastructure and services.

18. “Final or Finality” means irrevocable and unconditional.

19. “Foreign Currency Settlement Account” means a cash account maintained by the

Participant with OSIs for the purposes of foreign currency Settlement.

20. “Foreign-Currency Settlement Cut-off” means the cut-off time of a Business day when

the Host System ceases processing foreign currency transactions for value on the same

day, including any extension of time for the processing of transactions on that day which

PayNet may grant under these Participation Rules.

21. “FSA” means the Financial Services Act 2013.

22. “FX” means foreign exchange transactions.

23. “General Non-Compliance” refers to any non-compliance without pre-specified penalty

charges in the Participation Rules for Payments and Securities Services, and the

Operational Procedures for MYR Settlement in RENTAS, Foreign-Currency Settlement in

RENTAS, eSPICK and FAST.

24. “HKICL” means Hong Kong Interbank Clearing Limited.

25. “Host System” means the Central Host Computer System that provides the Payments

and Securities Services which is located at production site and / or back-up site including

any other back-up systems / sites.

26. “Identified Securities” means Eligible Securities tagged and identified in the Participants’

K account.

27. “IFSA” means the Islamic Financial Services Act 2013.

28. “Intraday credit” refers to funds extended either by BNM for MYR Settlement or by OSIs

for Foreign-Currency Settlement to RENTAS Participants for a period of less than one (1)

Business day.



29. “Intraday credit cut-off” means the deadline after which Participants will not be able to

drawdown on their intraday credit line with BNM.

30. “Intraday credit cut-off warning” means the notification provided to Participants thirty

(30) minutes prior to the intraday credit cut-off.

31. “K account” means collateral account for Scripless Securities in the RENTAS system held

with BNM.

32. "Licensed Financial Institutions" means commercial banks and investment banks

licensed under section 212 (3) of the Financial Services Act 2013 (FSA) and Islamic

banking licensed under Section 223 (3) of the Islamic Financial Services Act 2013 (IFSA).

33. “Live Run” refers to the process of operating on an actual basis using actual data on IT

recovery sites. Where necessary, business operations are shifted to the recovery site in

accordance with the Disaster Recovery Plan.

34. “Maximum Tolerable Downtime (MTD)” means the timeframe during which a recovery

must become effective before an outage compromises the ability of a Participant to

achieve its business objectives.

35. “MCT SAS”, or Foreign-Currency Transfer Settlement Account System, is a real-time

settlement module that effects the transfer of funds through Foreign Currency

Settlement Accounts that are maintained with Onshore Settlement Institutions (OSI)

appointed by BNM.

36. “MYR” refers to Malaysian Ringgit.

37. “MYR SAS”, or MYR Settlement Account System, is a real-time accounting module that

posts debits and credits to MYR cash accounts across the books of BNM. All MYR

Settlement Accounts are maintained with BNM.

38. “MYR Settlement Account” means a cash account maintained by the Participant with

BNM for the purposes of MYR Settlement.

39. “NWI” means the New WAN Infrastructure, a secure private high bandwidth managed

by Time Telekom Bhd, that is used to connect BNM and PayNet’s Systems to all

Participants.

40. “OSI”, or Onshore Settlement Institution, refers to an organisation appointed by BNM to

provide Settlement services for a particular foreign currency in RENTAS.

41. “Participant” means any financial institution or entity who has applied and has been

accepted by PayNet to participate in Payments and Securities Services and subject to

and in consideration of such acceptance the Participant shall observe and comply with

the Participation Rules.



42. Participant Terminals” refers to all software and hardware installed at the Participants’

premises, or that of its outsourcing service provider, which is linked to the Host Systems

for purpose of accessing Payments and Securities Services. For RENTAS, the Participant

Terminals would encompass the hardware and software for the Participants’ access

channels to the Host System (namely RENTAS Bank Gateway, SWIFT Access and/or

RENTAS iLINK);Payments and Securities Services” means the cheque clearing, payment,

Settlement, securities issuance, depository, paying agency and corporate actions

processing services offered by PayNet to Participants through the RENTAS, eSPICK and

FAST systems.

43. “PayNet” means Payments Network Malaysia Sdn Bhd, a company incorporated under

the Compannies Act 1965.

44. “PayNet’s Systems” refer to all systems and technology employed by PayNet for the

purpose of facilitating the Payments and Securities Services.

45. Private key” means the secret key in a key pair, which is known only to the Participant

who generated it. In asymmetric cryptographic systems such as E-PKI, private keys are

used to create digital signatures that uniquely identify the Participant.

46. “Public key” means the publicly disclosed key in an asymmetric cryptographic key pair

that is made known to everyone, and is used to verify the authenticity and validity of

Messages.

47. “PvP” means Payment-versus-Payment, a mechanism in a foreign exchange Settlement

system which ensures that a final transfer of one currency occurs if and only if a final

transfer of other currency takes place.

48. “Queue” means an arrangement where Settlement transactions are held by the RENTAS

System until sufficient balances are available in the paying Participant’s account to fund

the Settlement.

49. “Recovery site” means a recovery (back-up) site for IT infrastructure , systems and

business processes to be recovered and operationally ready to support business

functions after an outage.

50. “Recovery Time Objective (RTO)” refers to the timeframe required for IT infrastructure,

systems and business processes to be recovered and operationally ready to support

business functions after an outage; (See illustration below)

Data Current

ESCALATION

Incident/Outage

Occurs

Invoke

DRP

System Recovered

Maximum Tolerable Downtime (MTD)

Recovery Time Objective (RTO)

CLEAR

BACKLOG

RECOVERY

Data Current

ESCALATION

Incident/Outage

Occurs

Invoke

DRP

System Recovered

Maximum Tolerable Downtime (MTD)

Recovery Time Objective (RTO)

CLEAR

BACKLOG

RECOVERY



51. “RENTAS” refers to the Real-time Electronic Transfer of Funds and Securities System, is a

multi-currency real time gross settlement system for inter-bank funds transfer, a

securities settlement system and a scripless securities depository for all unlisted debt

instruments.

52. “RENTAS Bank Gateway” or RBG refers to RENTAS’ proprietary Participant access

channel with Straight-through processing (STP) capabilities, that act as a Participant

Terminal.

53. “RENTAS Host” means the RENTAS Central Host Computer System located at BNM,

including any back-up systems.

54. “RENTAS opening” means the time of that Business day from which the Host System is

ready and able to process transactions for the Business day.

55. “Real-time Retail Payments Platform (RPP)” means the Shared payment infrastructure

developed and established by PayNet which facilitates instant payments and collections

addressed using easily remembered proxies or by account numbers.

56. “Securities Account” means the scripless Securities Account held with BNM and

maintained in the RENTAS system.

57. “Service Provider” means a person or company engaged by a Participant to provide

services in connection woth the Payments and Securities Services.

58. “Settlement” or “Settle” refers to the process of adjusting financial positions of

Participants to reflect the amounts due to and from them as a result of the exchange of

clearing items, payment transactions and securities transactions. It refers to the final

and irrevocable discharge of an obligation of one Participant in favour of another

Participant, in central bank money for MYR transactions, or in commercial bank money

for foreign currency transactions.

59. “Specified RENTAS Securities” refers to Islamic / conventional short term and long term

scripless securities issued by the Government, BNM, BNM Sukuk Berhad and any other

issuer that may be specified by BNM.

60. “SSDS” means Scripless Securities Depository System.

61. “Straight Through Processing (STP)” means the online transmission of Messages directly

from Participants’ internal systems and complete automated processing of Messages

without the need for data entry or manual intervention.

62. “Suspended” membership will result in the following:

a. The Participant can only receive incoming IFTS transactions. Outgoing IFTS

transactions will be rejected;

b. All SSDS transactions and transfers initiated by or due to the member will also be

rejected;



c. Incoming funds will not be used to clear Participants' queues;

d. Outgoing IFTS queued transactions and SSDS transactions pending due to

insufficient securities will be cancelled at RENTAS Cut-off; and

e. Future-dated IFTS and SSDS transactions will be retained. Should the Participant’s

membership remains “suspended” when the future-dated transaction is due for

settlement, any incoming IFTS will be accepted for settlement, while any outgoing

IFTS or SSDS transactions will be rejected.

63. “SWIFT” refers to Society for Worldwide Interbank Financial Telecommunication.

64. “SWIFTNet” refers to the IP network infrastructure provided by SWIFT that facilitate

efficient messaging with SWIFT standards between its participants worldwide.

65. “SWIFT Access” refers to SWIFT Alliance Access (SAA) or other SWIFT-certified systems

as approved by BNM that act as a Participant Terminal.

66. Systemic risk” means the risk that the failure of one Participant to meet its required

obligations will cause other Participants to be unable to meet their obligations when

due, thereby potentially causing significant liquidity dislocations or credit problems and

threatening the stability of the financial markets.

67. “USD CHATS” means the US Dollar Clearing House Automated Transfer System, a real-

time gross settlement system for USD transactions in Hong Kong operated by HKICL.

68. “Unexpected Holiday" means a public holiday declared at the eleventh hour, which was

not initially a Known Public Holiday.